Group 4 Ashish Jalan (211121) Tapsi Ahuja (211148) Varun Bagai (211159)Vineet R Singh (211165)Yukti Agarwal (211169)
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
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
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
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
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.
100 60 160 180 20 80 40 120 140 01980-811981-821982-831983-841984-851985-861986-871987-881988-891989-901990-911991-921992-931993-941994-951995-961996-971997-981998-991999-002000-01 GDP Deflator2001-022002-032003-042004-052005-062006-072007-082008-092009-10 2010-11 GDP Deflator
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
2. Fuel and light3. Housing4. Clothing, bedding and footwear Clothing and bedding Footwear5. Miscellaneous Education Medical care Recreation Transport & communication Personal care and effects Household Requisites Others
Description Jan Feb Mar Apr May Jun Jul Aug SepFood, beverage 112.7 113.4 114.9 117.2 118.6 120.3 123.2 125.1 126.1 s & tobaccoFuel 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 & footwearMiscellaneous 113.4 113.7 114.1 114.6 115.7 116.7 117.1 117.8 118.9General 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
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.