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Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
Final Ppt Of Inflation
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Final Ppt Of Inflation

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inflation in india

inflation in india

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  • 1. Inflation in india
    2/24/2010 10:33 AM
    1
    Ghanshyamiilmgurgaon
  • 2. INFLATION
    “Inflation is nothing more than a sharp upward rise in price level.”
    Too much money chasing, too few goods.”
    Inflation is a state in which the value of money is falling i.e. price are rising.”
    2/24/2010 10:33 AM
    2
    Ghanshyam iilm gurgaon
  • 3. KINDS OF INFLATION
    On the basis of rate of inflation
    On the basis of degree of control
    On the basis of causes
    Others
    2/24/2010 10:33 AM
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    Ghanshyam iilm gurgaon
  • 4. CAUSES OF INFLATION
    Demand pull inflation
    Cost push inflation
    2/24/2010 10:33 AM
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  • 5. Demand-pull Inflation
    S
    D
    Ep1
    Ep
    D1
    Eq1
    Eq
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    Ghanshyam iilm gurgaon
  • 6. S1
    D
    S
    E1
    Ep1
    E
    Cost-push Inflation
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  • 7. HOW TO CONTROL INFLATION
    Monetary Measures
    Fiscal Measures
    Other Measures
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    Ghanshyam iilm gurgaon
  • 8. Monetary Measures
    Credit Control
    Demonetization of Currency
    Issue of New Currency
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    Ghanshyam iilm gurgaon
  • 9. Fiscal Measures
    Reduction in Unnecessary Expenditure
    Increase in Taxes
    Increase in Savings
    Surplus Budgets
    Public Debt
    2/24/2010 10:33 AM
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    Ghanshyam iilm gurgaon
  • 10. OTHER MEASURES
    To Increase Production
    Rational Wage Policy
    Price Control
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    Ghanshyam iilm gurgaon
  • 11. How is it Measured?
    Consumer Price Index
    Wholesale Price Index
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    Ghanshyam iilm gurgaon
  • 12. Consumer Price Index
    CPI is a measure estimating the average price of consumer goods and services purchased by households.
    CPI measures a price change for a constant market basket of goods and services from one period to the next within the same area (city, region, or nation).
    It is a price index determined by measuring the price of a standard group of goods meant to represent the typical market basket of a typical urban consumer. The percent change in the CPI is a measure estimating inflation.
    2/24/2010 10:33 AM
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    Ghanshyam iilm gurgaon
  • 13. Wholesale Price Index
    WPI was published in 1902,and was one of the economic indicators available to policy makers until it was replaced by most developed countries by the CPI market. index in the 1970.
    WPI is the index that is used to measure the change in the average price level of goods traded in wholesale market.
    Some countries (like India and The Philippines) use WPI changes as a central measure of inflation. However, India and the United States now report a producer price index instead.
    2/24/2010 10:33 AM
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    Ghanshyam iilm gurgaon
  • 14. Problems with WPI
    In present day service sector plays a key role in Indian economy. Consumers are spending loads of money on services like education and health. And these services are not incorpated in calculation of WPI.
    WPI measures general level of price changes either at level of wholesaler or at the producer and does not take into account the retail margins. Therefore we see here that WPI does give the true picture of inflation.
    2/24/2010 10:33 AM
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    Ghanshyam iilm gurgaon
  • 15. Problems with WPI
    WPI is supposed to measure impact of prices on business. “But we use it to measure the impact on consumers. Many commodities not consumed by consumers get calculated in the index.
    2/24/2010 10:33 AM
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  • 16. Weight edge to CPI & WPI
    2/24/2010 10:33 AM
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  • 17. Inflation rate
    PI for a certain year - PI for a comparative year X 100
    PI for a comparative year
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  • 18. INFLATION RATES
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  • 19. EFFECTS OF INFLATION
    They add inefficiencies in the market, and make it difficult for companies to budget or plan long-term.
    Uncertainty about the future purchasing power of money discourages investment and saving.
    2/24/2010 10:33 AM
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    Ghanshyam iilm gurgaon
  • 20. EFFECTS OF INFLATION
    There can also be negative impacts to trade from an increased instability in currency exchange prices caused by unpredictable inflation.
    Higher income tax rates.
    Inflation rate in the economy is higher than rates in other countries; this will increase imports and reduce exports, leading to a deficit in the balance of trade.
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  • 21. EXAMPLE
    Increase in the price of wheat
    Increase in the price of world oil
    Increase in the price of rice
    Increase in the price of CNG
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  • 22. T
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