Monetary policy is the process by which the monetary authority of a country controls the supply

of money, often targeting aninflation rate or interest rate to ensure price stability and general
trust in the currency.

Further goals of a monetary policy are usually to contribute to economic growth and stability, to
lower unemployment, and to maintain predictable exchange rates with other currencies.

Monetary economics provides insight into how to craft optimal monetary policy.

Monetary policy is referred to as either being expansionary or contractionary, where an

expansionary policy increases the total supply of money in the economy more rapidly than usual,
and contractionary policy expands the money supply more slowly than usual or even shrinks it.
Expansionary policy is traditionally used to try to combat unemployment in a recession by
lowering interest rates in the hope that easy credit will entice businesses into expanding.
Contractionary policy is intended to slow inflation in order to avoid the resulting distortions and
deterioration of asset values.

Expansionary monetary policy is appropriate when the economy is in recession and

unemployment is a problem. The goal of expansionary monetary policy is to reduce
unemployment. Therefore the tools would be an increase in the money supply.

To increase the money supply the federal government can:

 Buy government bonds(open market purchase)

 Lower the interest rate

 Lower the reserve ratio

Contractionary monetary policy is appropriate when economy is in expansion and inflation is a

problem. The goal of contractionary monetary policy is to reduce inflation. Therefore the tool
would be the decrease in the money supply.

To decrease the money supply the federal reserve can:

 Sell government bonds(an open market sell)

 Raise the interest rate

  Raise the reserve ratio

 Here are 10 reasons it’s worth starting a business during a downturn.

 1. People want innovation

Recessions create problems. They also slow investment in innovation down. Consumers
and businesses are looking for solutions to problems which presents opportunities for
startups to solve.

 2. People want to save money

As a nimble startup with few expenses, you should be able to undercut your competitors.
Their clients will be watching their wallets

3. Incumbents are vulnerable

Whether they’re giant corporates looking to scale back and hibernate through the downturn, or
smaller companies that might not have the resilience to see out the storm, your competition is in
a vulnerable state. Startups are agile and flexible, and as long as you can support yourself with
your minimal overheads, it’ll be hard for the economy to chew you up and spit you out.

4. Good people are looking for work

If you’re able to secure funding, or grow your business rapidly, you’ll probably be looking to
increase your headcount. But finding the right staff is really, really hard. In a downturn, when
layoffs are rife, highly qualified, talented and effective individuals can be found much more
easily than during the good times.

5. Things are cheaper

Weak economic growth means ailing businesses are selling off certain assets.  Put more simply,
things cost less. Your typical overhead costs such as office space, or one-off purchases such as
office furniture, tend to have lower base prices, and vendors are more likely to discount prices to
move stock quicker. Even the good people you find in point number three come cheaper,
demanding a lower salary and less benefits than they might in a strong economy.

6. Lower interest rates, mean cheaper credit

Not only do things cost less, the central banks of affected countries generally start to drop
interest rates to keep consumer spending high. This means that loans and particularly credit cards
may make more sense for your business in its early days, compared to the high interest rates used
to control inflation when the market is strong. I was able to start DesignCrowd.com off the back
of a credit card.
7. You will have less competitors

When the economy is strong, every man and his dog wants to startup. Many of these budding
entrepreneurs go straight for funding and eventually squash the bootstrappers. There are less
people trying to startup in a downturn because there’s less funding about. This makes it easier for
those who are keen bootstrappers — those who want to control ownership in the company, and
don’t have to split the pie with bankrollers.

8. Smart investors want to invest

But if you need funding — perhaps there’s plant and equipment costs that can’t be avoided —
there’s still plenty of determined investors who are looking for new business opportunities.
When the economy falters, angel investors in particular, look to move their money out of the
stock market and may be willing to fund you if your prospects are promising.

9. Downturns give startups negotiating power

Traditional vendors have trouble moving product when the economy is weak. If your company
depends on products from suppliers, a downturn is a great time to negotiate or renegotiate a deal
that will benefit you even after the downturn ends. When the economy is strong, a startup is just
another startup, and the vendor sets the rules.

10. You’ll build a lean startup with good habits

A startup built during the tough times is designed from the ground up to be a lean, mean,
efficiency machine – whether you’ve bootstrapped or not.  These habits should stay with you
when the market recovers, giving you higher profit margins since you’ll be able to lift prices
once consumers and clients are spending again.  If you can build and grow a business when
consumer confidence is down and businesses are tightening their belts, your business will be
bullet-proof when things improve.

Following are the differences between Internet, Intranet and Extranet.

 First difference between all is a matter of availability. Internet is a global network system
and is available to all while Intranet and Extranet are available to limited inside and outside
users of the organization.
 Intranet and Extranet are more secure than Internet because having Intranet or Extranet
network system means organization has created a firewall against outsiders. Accessing any
information on Internet is not much difficult today.
 General public is the user of Internet so it can be called as public network while business
persons and organization are the users of Intranet and Extranet and can be called as private
networks.
 Internet can be access through without having user account. While user account is the
first important condition in case of Intranet and Extranet.
 Internet has no hard and fast policies while there is a complete organization policy behind
the setup of Intranet and Extranet.