This document discusses inflation including its causes, types, and effects. Inflation is defined as a rise in general price levels over time which reduces purchasing power. Common causes of inflation include increases in the money supply, credit expansion, deficit financing, and artificial scarcity. The main types of inflation are demand-pull, caused by excessive demand, and cost-push, caused by increased input costs. Effects of inflation impact debtors, those with fixed incomes, consumers, producers, farmers, taxpayers, and governments. The document also includes a map of inflation rates worldwide and a report on rising food inflation forecasts.

2. Inflation???
Causes of Inflation
Effects of Inflation
Kinds of Inflation
Demand pull Inflation
Cost push Inflation
Map showing Inflation rates around the world
Report on Food Inflation

3. Inflation is a rise in the general level of prices of goods
and services in an economy over a period of time.
When the general price level rises, each unit of
currency buys fewer goods and services. Consequently,
inflation also reflects an erosion in the purchasing
power of money – a loss of real value in the internal
medium of exchange and unit of account in the
economy.

4. Causes of Inflation
 Increases in money supply
 Expansion of bank credit
 Deficit financing
 Black money
 Artificial Scarcity
 Population growth

5. Effect of Inflation
 Debtors and creditors
 People with fixed income
 Consumers
 Producers and businessman
 Farmers
 Tax payers and government

6. Kindsof Inflation
 Demand pull inflation is asserted to arise
when aggregate demand in an economy
outpaces aggregate supply.
 Cost push inflation is a type of inflation caused
by substantial increases in the cost of
important goods or services where no suitable
alternative is available.

7. Demand pullInflation
Demand pull inflation may be due to
Increase in money supply
Increase in government purchases
Increase in exports

8. Cost push inflation
Cost push inflation may arise because of
 Increase in money wage rates
 Increase in money prices of raw
materials.

9. CANADA
ALASKA GREENLAND
USA
BRAZIL UGANDA
AUSTRALIA
CHINA
RUSSIA MONGOLIA
Inflation rates around the world in 2009

10. Population 4 billion (60%)
GDP US$24.077 trillion (2008)
GDP (Currency) $16.774 trillion (2009)
GDP/capita $7,041 (2009)
GDP/capita $4,629 (2009)
Annual growth of
per capita GDP:
7.9% (2010)
Millionaires (US$): 3 million (0.06%)
Unemployment: 3.8% (2010 est.)
*Most numbers are from the IMF. All GDP figures are in US$.
Economyof Asia
During2008-10

12. Report on food Inflation
Consumer food inflation (CPI-Food) has remained benign since
late 2009, reflecting the declines in wholesale food prices during
2008-09, as well as weaker economic conditions. The CPI-Food
rose by a modest 0.2% during March 2010, the first increase in the
food inflation since August 2009. While inflation is currently
absent, consumer food prices are forecast to rise by 4.5% (vs. year
ago) by the end of 2010 – the third highest rate posted in the past
20 years. This compares to a decline of 0.5% during 2009, and
gains of 4.9% and 5.9% registered during 2007 and 2008,
respectively. The gain in consumer food prices is expected to be
driven by higher costs of wholesale and underlying commodity
inputs, most notably protein, dairy and soft commodity prices.
However, it is also important to recognize the important role that
economic conditions played in driving consumer food prices – both
in pressuring food prices lower during 2009 and likely supporting
higher rates of food inflation during 2010.

15. Made By:
Anant Agarwal
XI-D
Roll No. 4