Low rates of economic growth are related to financial systems in developing countries. What is this situation called and why might it exist?
Ans:- Financial system play a vital role in the development of an economy of a nation. That means a good financial system effeciently channeling the capital (Money) to invest. But the financial system is also measured as the basis of uncertainty specifically in the emergency (crisis) period. So the financial system shows an important role in the economic conditions of a nation. Financial assets are efficiently encourage the economic growth. Financial system promote the exchange of money between the commercial (financial) market that includes money lending, deposits, Mortgage etc. Financial system influence the movement of money between economic sectors. So low rate of economic growth is highly influvanced by the financial system in a nation.
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