Germany Jahrgangsstufe 13 Economics and Law
Chapters: 2
1. Law
Civil law: contracts and breaches · Civil law: buying and selling · Criminal law
- Criminal Law: Crimes, Offences and Defences – Criminal law lists acts the state treats as crimes and sets punishments. Most crimes need two parts: a guilty act (actus reus) and a guilty mind (mens rea). Offences can be against the person (fatal, like murder and manslaughter; non-fatal, like assault) or against property (like theft, robbery, fraud, criminal damage). Trying to commit a crime is itself an offence (attempt). Defences such as self-defence, insanity, duress or being under the age of criminal responsibility can remove or reduce guilt. The accused is presumed innocent; the prosecution must prove guilt beyond reasonable doubt in a fair trial.
2. Economics
Money and the price level · Foreign trade and exchange rates · Current macroeconomic problems in depth
- Money and Its Supply: Barter, Functions of Money and M1 – Barter (goods for goods) needs a double coincidence of wants and has no common measure of value. Money solves this. Its functions: medium of exchange (main), unit of account, store of value and standard of deferred payment. Money supply is the total stock of money held by the public (households and firms) at a point of time. Notes are issued by the RBI and coins by the government; demand deposits are created by commercial banks. Narrow money M1 = currency with the public (CU) + net demand deposits in banks (DD) + other deposits with the RBI (OD).
- Foreign Exchange Rate – The foreign exchange rate is the price of one currency in terms of another, such as ₹80 per dollar. Under a flexible rate, demand for and supply of foreign currency set it; a rise means the rupee depreciates. Under a fixed rate, the government sets it and changes it by devaluation or revaluation. Managed floating mixes both: the market sets the rate, and the central bank smooths big swings.
- Macroeconomic Objectives and Policy Conflicts – Governments want four main things for the whole economy: steady growth of real GDP, low unemployment, stable prices (low inflation, often about 2%) and a sustainable balance of trade. Many also aim for a fairer spread of income and a protected environment. These goals often clash: a policy that helps one can hurt another, so governments must choose trade-offs.