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Economic Crisis of Sri Lanka

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  Opening Statement   Sri Lanka’s government declared an economic emergency to deal with foodstuff shortages and to contain soaring inflation.   Everyday life for people in Sri Lanka has become a major challenge. Essentials like food, medicine and fuel are much more expensive – and that is, if they are even available. The COVID-19 pandemic and a recession are being blamed, while a dramatic fall in the value of the Sri Lankan rupee is making things worse. The island nation depends largely on imports for its food, and a weaker currency means they are now costlier. Government has announced an economic emergency in a bid to ease the burden for millions of families and has empowered authorities to seize stocks of staple foods and set their prices amid the forex crisis.   Economic Overview of Sri Lanka     The  free-market economy  of Sri Lanka was worth $84 billion by nominal  gross domestic product  (GDP) in 2019 and $296.959 billion by  purchasing power parity  (PPP). The country had expe
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Types of Economies

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  Economies can broadly be classified into three different types -   1. Controlled Economy 2. Economy 3. Mixed Economy   In every country economic activities are controlled by the government. But the extent to which the government controls the economic activities differentiates these economies.   Controlled economy Market economy Mixed economy Economic decisions are taken by government or some central authority Economic decisions are taken by the free forces of the market Economic decisions are taken by both government and market forces Social welfare is the main motive in decision making Profit maximisation is the main motive in decision making Profit maximisation and social welfare both are the main motive in decision making The public sector dominates the economic activity The private sector dominates the economic activity Both public and private sector have their fair share in economic activity Most of the countries resources are controlled by government Most of the countries resou
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Opportunity Cost

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  The cost of shifting resources from use A to use B is called opportunity cost. Example -   Assume that you have 10 hectares of land, you can produce apple and wheat on your land -   Apples [kg] 100 90 70 40 0 Wheat [kg] 0 25 50 75 87   Using all your given resources you can produce either 100 lakh kg of apple  or 87 lakh kg of wheat . And if you wish to produce both apples and wheat you can select any combination of two goods from the table.   1. So first you decide to produce 100 kg of apples , so you have prepared your land for better production of apples and bought machinery for apple production. 2. But after some years you decide to produce wheat in some parts of your land, so you have to shift your resource from apple to wheat. Now you produce 90kg of apple  and 25kg of wheat . 3. After some years you decide to increase your wheat production [ due to more profits by selling wheat ], so you shift some more resources from apple to wheat. Now you produce 70kg of apple and 50kg of w
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Central Problems Of An Economy

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  Every economy whether it is developed or developing, must face three central problems -   1.  What to produce 2.  How to produce 3.  For whom to produce   So the first question that arises here is why do economies face these problems, the answer is -   1.  We have unlimited wants 2.  We have limited sources to fulfill all our wants 3.  And, resources have alternative uses   [Explanation - Resources have alternative uses The central problems of economy arises only because resources have alternative uses. For Example - If farming land could be used only for the production of rice and no other crop then where is the problem. Just grow rice and relax! The problem arises because farming land can be used for the production of different crops, like wheat, rice and bajra ]        What to produce   This can be studied in two dimensions   - What goods are to be produced in an economy - In what quantity goods are to be produced   What goods are to be produced ?   We know that our wants are unli
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A world without Nuclear Weapons

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  Opening Statement   “We must abolish Nuclear weapons, or they will abolish us” By - John F.Kennedy   To lift the specter of mass destruction we must come together to pursue the peace and security of a world without nuclear weapons. Nuclear weapons threaten every city on the planet with staggering humanitarian, environmental, and economic loss. So long as they exist we will never be safe. This world will be a better place without nuclear weapons and it should be our dream.       A Little History     Ideas about eliminating the bomb are as old as the bomb itself. The movement first started in Japan in 1954, an estimated 35 million signatures were collected on a petition calling for a ban on nuclear weapons. Many different treaties were signed after that but none of them assured zero nuclear weapons. A movement known as Global Zero has gained in strength to attempt just that. It was established in January 2007 by George Shultz, Henry Kissinger, William Perry, and Sam Nunn advocating a n
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