How inflation get connected with economy, how we can protect our self from inflation. Its effects, causes, consequences, solutions, how to control and RBI policies.
2. • DEFINITION
• TYPES OF INFLATION
• CAUSES OF INFLATION
• EFFECTS OF INFLATION
• CONSEQUENCES OF INFLATION
• HOW TO PROTECT YOURSELF FROM INFLATION.
• NATURE OF INFLATION IN DEVELOPING ECONOMY.
• HOW TO CONTROL INFLATION
3. According to G. Crowther, “Inflation is a state in
which the value of money is falling i.e. prices
rising”.
According to Paul Samuelson, “ A rise in the
general level of price”.
According to Harry G. Johnson, “ Inflation is a
sustained rise in prices”.
Definitions…
4. Types of inflation…
Open Inflation
Supressed
Inflation
Galloping
Inflation
Creeping Inflation Hyper Inflation
5.
6. CAUSES OF INFLATION…
1. DEMAND
PULL
2. COST PUSH
Black money
Disposable income
Dearness allowance
RBI’S Monetary policy
Wages
Taxes
Raw
Material
Profit
Margin
7. INVESTMENT
INTEREST RATES
EXCHANGE RATES
UNEMPLOYMENT
STOCKS
DECREASE IN THE PURCHASING POWER
CHANGE THE ALLOCATION OF INCOME
EFFECTS OF INFLATION…
8. Nature OF Inflation IN DEVELOPED
ECONOMY
DEMAND PULL FACTORS
INCREASE IN INCOME
HUGE EXPENDITURE
INCREASING
POPULATION
FOREIGN AID CAPITAL
COST PUSH FACTORS
INELASTIC SUPPLY
SUPPLY SHOCKS
BACKWARD AGRO. SECTOR
CHANGE IN EXCHANGE RATE
INEFFICIENT PUBLIC
SECTORS.
9. Adverse effect on production
Adverse effect on income of distribution.
Obstacle to development.
Changes in relative prices.
Adverse effect on the B.O.P
CONSEQUENCES OF INFLATION