EDUPEDIA247

CHAPTER ONE INTRODUCTION 1.1 Overview The existence of a set of policies that can alter a given state of an economy to a desired state is assumed in the theory of economic policy. Regulatory policies are therefore made, to affect economic behaviour in particular directions that the economic policy-maker may desire from time to time (Ndekwu 1999). Macroeconomic policy is basically classified into two broad categories namely: monetary and fiscal policies. The policy itself depends on economic theory which is based on several assumptions because we are in the world of uncertainty. Therefore, Nigeria is not exceptional because government had been performing a lot of roles in influencing her economic activities since the creation of the country in 1960. Both fiscal and monetary policy are formulated to achieve certain macroeconomic objectives such as full employment, price stability which is the same as low and stable inflation and balance of payments equilibrium. However, some e

CHAPTER ONE 1.0    INTRODUCTION 1.1    BACKGROUND TO THE STUDY Economic development is the back born of development in any society. Countries of the world are classified as developed, developing and under-developed based on their level of economic development. Governments formulate laws to regulate and control the conduct of economic activities of their countries in order to provide enabling environment for economic growth and development. In Nigeria, governments formulate policies and guidelines with a view to achieve economic growth and development. Central Bank is charged with the task of implementing the monetary policies of the government. Since its establishment in 1958, the objectives of the Central Bank of Nigeria have remained broadly the same, but the strategies for achieving these objectives have changed in consonance with the varying legal, institutional and macroeconomic environments. Over the years, the objective of monetary policy had been the attainment of internal and