what is inflation, types, caused, cure etc.

1. INFLATION
PRESENTATION BY - GROUP 1

2. DEFINATION
In economics, inflation (or less frequently, price inflation) is a general
rise in the price level of an economy over a period of time. When the
general price level rises, each unit of currency buys fewer goods and
services; consequently, inflation reflects a reduction in the
purchasing power per unit of money – a loss of real value in the
medium of exchange and unit of account within the economy.
As per RBI, an inflation target of 4 per cent with a +/-2 per cent
tolerance band, is appropriate for the next five years (2021-2025).
FORMULA TO MEASURE INFLATION
Inflation Rate = [(Current Consumer Price Index - Previous Consumer
Price Index) / Previous Consumer Price Index] x 100

3. TYPES OF INFLATION
The different types of inflation in an economy can be explained as
follows:
Demand-Pull Inflation
This type of inflation is caused due to an increase in aggregate
demand in the economy.
Causes of Demand-Pull Inflation:
-A growing economy or increase in the supply of money
- Increased borrowing.
-Depreciation of rupee.
-Low unemployment rate.
Cost-Push Inflation
This type of inflation is caused due to various reasons such as:
-Crude oil price fluctuation
-Low growth of Agricultural sector
-Food Inflation
-Interest rates increased by RBI

4. REMEDIES TO INFLATION
The different remedies to solve issues
related to inflation can be stated as:
-Monetary Policy (Contractionary policy).
-Fiscal Policy.
-Lower Health Care Costs.
-Reform the Tax Code to Raise More Revenue

5. HOW DO INDIA FACING INFLATION
-India’s retail inflation once again increased to 6.52% in
January 2023 mainly due to an increase in food inflation
driven by higher prices of cereals and products.
-The retail inflation based on the Combined Price Index
(Combined) had reduced to 5.72% in December 2022.
- The Combined food price inflation (CFPI) increased to
5.94% in January 2023 as compared to 4.19% in December
2022 and 5.43% in the year-ago period.
-Further, rural inflation has overtaken urban inflation in recent
months as it increased from 6.05% in December 2022 to 6.85%
in January 2023.
And, urban consumers have experienced a retail price rise of
6% in January 2023 as compared to 5.4% in December 2022.

6. What is causing India’s inflation to persist?
-The initial shock of rising food and fuel prices gradually
spread and became more widespread in the following months,
resulting in persistent core inflation that remained high.
-Despite weak demand and limited pricing power, input cost
pressures were unprecedented and resulted in higher output
prices, particularly for goods.
Effects of Inflation Rate in India
-Impact on Consumers of Inflation Rate in India
-Impact on Businesses of Inflation Rate in India
-Impact on the Economy of Inflation Rate in India

7. COCLUSIOM
WE'VE LEARNED THAT INFLATION
AFFECTS THE ECONOMY, USING INDIA
AS AN EXAMPLE. IT CAN BE GOOD IN
SMALL AMOUNTS, BUT TOO MUCH CAN
HARM OUR ABILITY TO BUY THINGS. WE
NEED THE RIGHT GOVERNMENT
POLICIES AND EVERYONE'S
COOPERATION TO KEEP INFLATION IN
CHECK AND CREATE A STABLE AND
PROSPEROUS ECONOMY.