INFLATION

Presented by
Irene asha tirkey
 INTRODUCTION
Inflation is defined as a sustained increases in the
price level in the value of money.
Value of money depreciates with the occurrence of
inflation.
According to Samuelson defines ”inflation occurs
when the general level of prices and costs is
rising”.
 WHAT DERIVES INFLATION ?
Supply shocks is an event that suddenly increases
or decreases the supply of a commodity or service.
This sudden change affects the equilibrium price
of the good or service.
 Demand shock is a sudden event that temporarily
increases or decreases demand of goods or
services. A positive demand increases demand
while negative demand shock decreases demand.
Both positive and negative demand shock have an
effect on the prices of goods and services.
 TYPES OF INFLALTION
Open inflation
Suppressed inflation
Galloping inflation
Creeping inflation
Hyper inflation
 Impact OF INFLATION

Reduction in volume of production

Bad quality of product
Moral effects
Political stability
Unequal distribution of wealth

“RICH BECOME RICHER AND POOR BECOMES

POORER”
 REMEDIES OF INFLATION
1.Monetary Policy:
Credit control
Demonetization of currency
Issue of new currency
2.Fiscal Policy:
Increase in taxes
Reduction in uncessary expenditure
Increase in savings
3.Other Measures:
To increase production
Price control
 REFERENCE
Internet
https://www.thebalance.com
Book
M.l. Jhingan
THANK YOU