Question

What is indigenous banking system? Explain in detail in microeconomics?

Answer 1

Indigenous banking system is defined as the system of banking that involves either private firms or individuals who can act as banks by providing financial services such as accepting deposits and loans.

Microeconomics is defined as the study of behaviour individuals, firms, and households in decision-making and the allocation of resources.

The following are the importance of microelectronics:

• It helps in formulating the economic policies which helps in enhancing the productivity, efficiency, and social welfare.
• It is used for explaining the gains from trades.
• The working of a capitalist economy is explained with the help of microeconomics.

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The following are the limitations of microeconomics:

• It fails to explain the functioning of an economy.
• It fails to explain the reason for unemployment, illiteracy, and poverty.