Chapters

Inflation

Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, the purchasing power of currency is falling. Inflation occurs due to an imbalance between demand and supply of money, changes in production and distribution cost or increase in taxes on products.

When economy experiences inflation, i.e. when the price level of goods and services rises, the value of currency reduces. Two important types of inflation are:

  1. Demand Pull inflation: This occurs when demand increases at a faster rate than supply. Demand pull inflation will typically occur when the economy is growing faster than the long run trend rate of growth. If demand exceeds supply, firms will respond by increasing the prices.
  2. Cost push inflation: This occurs when there is an increase in the cost of production for firms causing increase in price of products. Cost of pro­duction may rise due to an increase in the prices of raw materials, wages, etc. Often trade unions are blamed for wage rise since wage rate is not completely market-determined. Higher wage means high cost of production. Prices of commodities are thereby increased.

Hyper Inflation

Hyperinflation is extremely rapid or out of control inflation. In hyper-inflation value of money falls so rapidly that people start losing faith in the currency and policy makers thin in terms of switching over an alternative currency.

Galloping Inflation

When inflation rises to ten percent or greater. Money loses value so fast that business and employee income can't keep up with costs and prices. Foreign investors avoid the country, depriving it of needed capital. The economy becomes unstable, and government leaders lose credibility. Galloping inflation must be prevented.

Stag Inflation

When inflation rises to ten percent or greater. Money loses value so fast that business and employee income can't keep up with costs and prices. Foreign investors avoid the country, depriving it of needed capital. The economy becomes unstable, and government leaders lose credibility. Galloping inflation must be prevented.

Recession

A situation when there is a negative growth of GDP for two successive quarters signifies a situation of recession. It is a situation characterized by falling demand, growing business loss and falling investment.

Depression

Recession which goes for a very long time unchecked takes the form of depression. It is a situation characterized by fall in price, fall in demand, very fast decline in employment and falling production. Depression is more severe than recession. 

Inflation Measuring Indices

Inflation in India is measured by using two indices, which are as follows:

  1. Wholesale Price Index (WPI): This is done on the basis of wholesale price of 435 commodities collected from major wholesale markets in the country on a weekly basis. It is used to measure the rate of inflation in the country on a point to point basis which means rate of inflation during a certain week ending this year to the corresponding week ending last year. This is done on the basis of wholesale price of 435 commodities collected from major wholesale markets in the country on a weekly basis. The base year for WPI is 2000-01.
  2. Cost Price Index (CPI): It is used to measure the cost of living of a common man on the basis of retail prices collected every month for 260 commodities which also includes some services. CPI is used to grant Dearness Allowance (DA).

Latest Current Affaris

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Current affairs 05/06/2019

1). Comptroller and auditor general Rajiv Mehrishi has been appointed as the external auditors of World Health Organisation (WHO) for a four year term from 2020-23. 2).World Environment Day is observed on 5 June(Theme: The Air Pollution). 3). Madhya Pradesh cabinet has passed a resolution to increase reservation of OBC's 27%.

करंट अफेयर्स 03-04/06/2019
करंट अफेयर्स 03-04/06/2019

1. नयब बुकेले को ईआई सल्वाडोर के राष्ट्रपति के रूप में चुना गया है। (ईआई सल्वाडोर की राजधानी: सैन सल्वाडोर, मुद्रा: संयुक्त राज्य अमेरिका डॉलर) 2. राष्ट्रीय सुरक्षा सलाहकार (NSA) अजीत डोभाल की दोबारा अपने पद पर नियुक्ति हुई। NDA सरकार के दूसरे कार्यकाल में उन्हें कैबिनेट रैंक दिया गया है। 3. 3 जून को विश्व साइकिल दिवस मनाया जाता है।

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1. Nyaib Bukele has been Sworn in as the president of  EI Salvador ( EI Salvador's capital: San Salvador, currency: United States Dollar). 2. National Security Advisor (NSA) Ajit Doval reappointed to his post and given Cabinet rank in the second term of the NDA government. 3. World Bicycle Day is observed on 3rd June .

Current Affairs Quiz

डेली जीके क्विज 17/05/2019
डेली जीके क्विज 17/05/2019

1. भारतीय नौसेना प्रमुख का नाम बताएं? 2. हाल ही में ICC द्वारा पहली महिला मैच रेफरी के रूप में किसे नियुक्त किया गया है? 3. हाल ही में एक हल्के खेल विमान (एलएसए) में अटलांटिक महासागर को पार करने वाली दुनिया की पहली महिला कौन बनी है?

Daily Gk Quiz 17/05/2019
Daily Gk Quiz 17/05/2019

1. Name the Indian Navy Chief? 2. Recently who has been appointed as first female match referee by ICC? 3. Recently who has becomes the world’s first woman to cross the Atlantic Ocean solo in a light sports aircraft (LSA)?

डेली जीके क्विज 29/09/2018
डेली जीके क्विज 29/09/2018

प्रश्न 1)। हाल ही में एशियाई विकास बैंक (एडीबी) ने राज्य में रोजगार को बढ़ावा देने के लिए मध्य प्रदेश में पहला बहु-कौशल पार्क स्थापित करने के लिए 150 मिलियन डॉलर के ऋण को मंजूरी दे दी है। एडीबी के अध्यक्ष कौन हैं? प्रश्न 2)। परकर्म परव किस अवसर पर मनाया जा रहा है? प्रश्न 3)। भारत की लाइव स्टॉक जनगणना 1 अक्टूबर से शुरू होने वाली है। इस तरह की कितनी जनगणना पहले आयोजित की गई है और यह कौन सी जनगणना है?