Question

Analyse the condition of money demand and supply in Pakistan's economy. Compare the money situation of Pakistan with the Indian and USA money markets.

Answer 1

The economy has undergone stability and advancement over the years; Pakistan is the 22nd biggest in the world in purchasing power parity (PPP) and ranked as the 40th advanced in nominal gross domestic product Sana et al. (2020). Pakistan has a population of more than 220 million, and the country's GDP per capita is $1,569 in 2020-21; this has significantly improved compared to 2019 when it was ranked 132 in the world. India has a higher position in terms of money demand and supply than Pakistan.

India is a renowned middle-income alleviating market economy, the 5th biggest economy by nominal GDP and the third-largest in the purchasing power parity (PPP). The per capita income is ranked 142nd and 124th by GDP (PPP) in 2020. United States is the largest world economy by nominal GDP and second-largest by PPP. It has the 5th per capita GDP and seventh-highest per capita GDP (PPP) in 2020. The country has a mixed economy making it the supreme economic power when compared with Pakistan and India.

Work Cited

Sana, Shazia, et al. "Money Demand Balances, and Exchange Rate in Pakistan: A Time Series Analysis." Journal of Business and Social Review in Emerging Economies 6.4 (2020): 1391-1399.