IGNOU IBO 1 2015 2016 - Discuss the methods of correcting disequilibrium in balance of payment

Question

Discuss the methods of correcting disequilibrium in balance of payments.

01 Nov 2017

Answer :

Word Count : 305

Methods of Correcting Disequilibrium in Balance of Payments

A continuous deficit in balance of payments will have to be corrected eventually. There are many methods for correcting the disequilibrium. Some important methods are discussed below.

Imports can be restricted. This may be done by fixing import quotas and in some cases by prohibiting the import of some non-essential commodities. However, a disadvantage of this method is that people may be denied some important foreign goods and sometimes it may

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