Thesis Abstract

The purpose of this project is to evaluate the Effect of
Monetary and Fiscal Policies in checking the causes of Inflationary trends in
the Economy.

Before the advent of fiscal and monetary policies, inflation
has been regarded as a nation’s scourage, which tried to parlayed economic
activities in the economy. this persistent inflationary increase in the country
gave impetus for the launching of these two policies as a good weapon to check
the negative tendencies of inflation.

This work however considers briefly some of the various
instruments used in monetary and fiscal policies to curb this problems. It also
examiners the extent of compliance of various income earner (fixed income
earners and businessmen) and even the government towards these policies. The
research work is divided into five sections. The introduction, the literature
review, the research methodology, discussion of findings, summary, conclusion
and recommendation. It is therefore, a comprehensive and balance supplement to
augment the effort of previous writers in the field. It is valuable to readers
and future writers.

Thesis Overview

1. INTRODUCTION

1.1
GENERAL OVER VIEW OF THE STUDY

In general monetary policy refers to the
combination of matures designed to regulate the value, supply and cost of money
in all company, in consonance with the level of economic activity. And excess
supply of money which will result in an
demanded for goods and services will cause rising price and / or a
deterioration of the balance of payment position. On the other hand, an inadequate
supply of money could in due stagnation in the economy and there by retained
growth and development-

Consequently, the central bank or the central monetary authority must attempt to keep the money supply growing at an appropriate rate to ensure sustainable economic growth and to maintain internal and external stability.

The discretionary control of the money stock by the central
monetary authority, thus, involves the expansion or contraction of money
influencing interest rates to make money influencing interest rates o make
money cheaper or more expensive depending on the prevailing economic conditions
and the channeling of money to priority sectors.

In a nutshell, the aims of monetary policy are basically to
control inflation, maintain a healthy balance of payments position for the country
in order to safeguard the external
values of the national currency and
promote an adequate an sustainable level of economic growth and
development. The techniques by which the monetary authority tries to achieve
the above objectives can be classified normally its two categories, the direct
or portfolio control approach and indirect or market intervention.

In another development fiscal policy has its own measures, which aid in checking the causes of inflation in the economy. Such as the use of fiscal policy as a means of increasing economic activities and the use of fiscal policy as means of reducing economic activities, however, the researcher expatiates more of monetary policy due to its direct relationship towards inflationary tred.