eco ppt final

7/31/2019 Eco Ppt Final

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Stagflation Stagnation + Inflation = Stagflation

A period where the economy is very slow + Thecontinuous price increases = Unfavorable economic

condition Economy is slowed by unfavorable shock

Ex: Increase of price in oil in oil importing country

Can also result from inappropriate macroeconomic

policies Inflation = excessive growth of money supply

Stagnation = excessive regulation of goods markets and labormarkets.


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HYPERINFLATION


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There are various factors which cause inflation in

the economy -

Monetary Factors

Expansion of Money Supply

Increase in Disposable Income

Increase in Indirect Taxes

Drop in exchange Rate


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Non-monetary Factors

Rising Population

Natural Calamities

Speculation and Black Money

Unfair Practices by Monopoly Houses

Bottlenecks and Shortages


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Structural Factors Capital Shortage

Infrastructural Bottlenecks

Limited Efficient Entrepreneurs

Lack of Foreign Capital

Imperfections of the Market

Unemployment


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Global Factors

Increase in International Prices

Cold War with other countries

Rise in Fuel Prices


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Benefit the cartels formed by the

companies

Benefit borrowers

Farmers Gain In Inflation

Tobin effect


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Hoarding

Increased risk - Higher uncertainties

Distortion of relative prices


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Fixed income recipients will be hurt

Lowers national saving

Rising prices of imports

Income diffusion effect

Illusions of making profits


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Rising prices of imports

Existing creditors will be hurt

Currency debasement

Causes business cycles

Causes an increase in tax bracket


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The Various measures to control inflation are:

1.Monetary Measures

2.Fiscal Measures

3.Physical Measures


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1. Monetary measures

The monetary measures which are

widely used to control inflation aredivided into-

Bank rate policy

Statutory Liquidity Ratio

Open market operation

Repo rate


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Reverse repo rate

Cash Reserve Ratio

Key Rates 2009 April,2010 Dec,2010

CRR 5.75% 6% 6%

Repo rate 5% 5.25% 6.25%

Reverse

Repo rate 3% 3.75% 5.25%


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Selective credit controls

Moral suasion

Credit authorization scheme


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Taxation

Government expenditure

Public borrowings

Protectionist measures


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To Increase Production

Price Control

Rationing


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Food price inflation is one of the most critical economic

problems in the country today.

Lower agricultural growth in India compared to the much

faster GDP growth.


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The high food price inflation is having a significant impact

on the Indian consumer.

The chart below gives the way the Indians spend.


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Lowproduction and productivity

The prevailing market inefficiencies lack of

coordinated efforts in public procurement

Poor distribution

Wastage due to inadequate and poor storage

facilities

Inefficient public distribution system

Speculative trading

Increasing retail margins


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The release of food grain stocks together with

faster distribution.

Part of Foreign Exchange Reserves can be used

for bulk import of essential commodities.

Improving food production and productivity.

Promoting Private sector Participation in Food

grain Management.

Stepping up investments

Foreign Direct Investment (FDI) in food retailing


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JESSY FERNANDES -14

SHRUTI JOSHI 22

AASHIYA KHAN

24 PADMAPRIYA 39

JASVEEN SEHGAL - 46


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eco ppt final

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