The document discusses different methods of calculating inflation including the wholesale price index, consumer price index, and GDP deflator. It provides details on the composition and calculation of the consumer price index and shows data on inflation rates in India from 1980-2011 as measured by CPI and WPI. Line charts compare movements in CPI, WPI, and GDP deflator over time. Tables list the components of the consumer price index basket and provide inflation data for various categories from January to September.

1. Group 4
Ashish Jalan (211121)
Tapsi Ahuja (211148)
Varun Bagai (211159)
Vineet R Singh (211165)
Yukti Agarwal (211169)

2.  is a rise in the general level of prices of goods and
services in an economy.
 Inflation results in the loss of purchasing power of
money.
 Calculation Methods:
1. Wholesale Price Index
2. Consumer Price Index
3. GDP Deflator

3.  It measures the rise in prices of wholesale goods
 Fixed basket of goods.
 Calculated on wholesale prices.
 Has been used in India to measure the inflation
level

4.  Measures the changes in the price level of consumer
goods and services purchased by households.
 Has a fixed basket of goods and services.
 Most commonly used measure of Inflation

5.  GDP deflator is a measure of the level of prices of all
new, domestically produced, final goods and services
in an economy.
 It helps to measure the actual growth of GDP by taking
care of the price level changes
 GDP Deflator: (Nominal GDP/Real GDP) x 100

6.  CPI is a better measure of inflation.
 It measures inflation as experienced by consumers in
their day-to-day living expenses.
 GDP deflator is a close substitute of CPI but it is
difficult to calculate as the basket of goods and
services keeps on changing every year.

7. 0
8
10
6
16
12
4
14
2
1980-81
1981-82
1982-83
1983-84
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1990-91
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
CPI
WPI

8. 100
60
160
180
20
80
40
120
140
0
1980-81
1981-82
1982-83
1983-84
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1990-91
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
GDP Deflator
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
GDP Deflator

9. 1. Food, Beverages and Tobacco
 Cereals and products
 Pulses and products
 Milk and milk products
 Oils and fats
 Egg, fish and meat
 Condiments and spices
 Vegetables
 Fruits
 Sugar, honey etc.
 Non-alcoholic beverages
 Prepared meals etc.
 Pan, tobacco and intoxicants

10. 2. Fuel and light
3. Housing
4. Clothing, bedding and footwear
 Clothing and bedding
 Footwear
5. Miscellaneous
 Education
 Medical care
 Recreation
 Transport & communication
 Personal care and effects
 Household Requisites
 Others

11. Description Jan Feb Mar Apr May Jun Jul Aug Sep
Food, beverage 112.7 113.4 114.9 117.2 118.6 120.3 123.2 125.1 126.1
s & tobacco
Fuel and light 119.8 120.0 120.3 121 121.7 122.7 123.9 125.4 126.5
Housing 112.9 113.6 114.4 115.3 116.2 117.5 118.4 119.5 120.6
Clothing, 122.7 123.3 124.2 125.3 126.5 127.7 128.9 130.2 131.5
bedding &
footwear
Miscellaneous 113.4 113.7 114.1 114.6 115.7 116.7 117.1 117.8 118.9
General Index 114 114.6 115.6 117.1 118.2 119.7 121.4 122.9 124
Inflation calculated by taking 2010 (base year) values as 100

12.  The rate of inflation has been increasing for all
categories.
 The highest increase is seen in food, beverages and
tobacco.
 Hence, general index has increased from 14% in
January to 24% in September.