Group presentation

Masab Farooq
(10)
Fahad Sattar
(06)
Zaid Ali
(29)
Bilal Ahmed
(05)

Topic Of
(1)Kinds
Of
Presentation
Inflation

(2)
Inflation
V/S
Deflatio
n

Kinds of Inflation
(1)On The Basis Of Causes
(2) Anticipated V/S unanticipated
inflation
(3)On The Basis Of rate Of
Inflation
(4)On The Basis Of degree Of
control
(5) On The Basis Of Employment

) On The Basis Of Causes

1)Demand Pull Inflation
2)Cost Push Inflation
3)Profit Induced Inflation
4)Budgetary Inflation
5)Monetary Inflation
6)Multi Casual Inflation

Kinds of Inflation

Demand Pull Inflation:

1)Inflation Caused by increasing in aggregate

demand.
Factor
1)Increase in money supply.
2)Increase in the demand for
goods by the govt.
3)Increase the income of various
factor of production.

Kinds of Inflation

Cost Push Inflation:

Increase in cost of production.

Profit Induced inflation:

Entrepreneurs due to their
monopoly position raise the profit
margin on goods.

Kinds of Inflation
Budgetary inflation:
Country covers the budget deficits through bank
borrowings and creating now money.
Purchasing power of community increases without a
increase in production of goods.

Monetary inflation:
Inflation is caused by too rapid increase in money supply

)Anticipated V/s Unanticipate

Anticipated inflation:
Rate of inflation which majority of the individuals believe will
occur.

Unanticipated inflation:
Rate of inflation which comes as a surprise to majority of
individuals.

)On the basis of rate of infl ation

(1)Creeping inflation
(2)Walking inflation
(3)Running inflation
(4)Hyper inflation

Creeping infl ation:

(1)General prices level increases upto a rate of 2% per
annum.
(2)It is generally considered a necessary condition of
economic growth.

Walking infl ation:

The price rise is around 5% annualy.

Running infl ation:

The price increases about 8 to 10% per annum.

Hyper infl ation:

(1)It starts after the level of full employment is reached.
(2)Price level rises very rapidly within a short period.

n the basis of degree of control

(1)Open Inflation
(2)Suppressed Inflation

Open Infl ation:

Inflationary process in which prices are permitted to
rise without being suppressed by government price
control or similar measures.

Suppressed infl ation:

(1)Govt. makes efforts to check and control the rise
in price level through price control and rationing.
(2)Suppressed inflation results many evils such as
black marketing, hoarding, corruption and
profiteering.

) On the basis of employmen

(1)Partial inflation
(2)Full inflation

Partial infl ation:

(1)General Price level raises partly due to an
increase In cost of Production
(2)And partly due to rise in supply of money before
the full employment stage is reached.

Full infl ation:

(1)Economy reaches the level of full employment.
(2)Increase in money supply will result in the rise in
price level without any increase in output and
employment.

Inflation vs. deflation

While
inflation
represents an overall
upward price
movement of goods and
services, deflation acts
adversely. We take a
look at the basics of
both.

Inflation
Inflation is a rise
in the general
level of prices of
goods and
services in an
economy over a
period of time

Effec
t in the general level of prices.
- An increase
- decrease in the purchasing power of the
currency.
- High or unpredictable inflation rates are
regarded as harmful to an overall
economy.
- make it difficult for companies to budget
or plan long-term.
- affect the balance of trade.
- negative impacts to trade from an
increased instability in currency
exchange prices caused by

Deflation
Deflation is a
decrease in the
general price level of
goods and services.
Deflation occurs
when the inflation
rate falls below 0%
(a negative inflation
rate).

Effects
Deflation is a problem in a modern economy
because it may aggravate recessions and lead
to a deflationary spiral.
The effects of deflation are:
1 Decreasing nominal prices for
goods and services.
2 Increasing buying power of
cash money and all assets
denominated in cash terms.
3 May decrease investment and
lending if cash holdings are
seen as preferable.
4 Benefits recipients of fixed
incomes.

THE END