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Inflation

How to define Inflation? This can be defined as a sustained rise in the general price levels of goods and services in an economy, over a specified period of time. It is usually measured as an annual percentage of price change. This annual percentage is known as the inflation rate. Factors that lead to a rise in Inflation: This is primarily caused by two different sets of factors: (1) Demand Side Factors (2) Supply Side Factors (1)Demand Side Factors: When the aggregate demand exceeds the aggregate supply, there is a rise in the overall price level. This type of inflation is known as  Demand-Pull Inflation. Some of the major factors that cause this are: (a) Expectation of Inflation: When people expect a higher inflation in the future, there will be a rise in the present actual inflation. Suppose you expect a high inflation in the future i.e. you expect the prices of goods and services to rise in the future. So to avoid the rise in price you will buy the good or service today. Imagin...
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What is IIP

So What is Index of Industrial Production (IIP)? The Index of Industrial Production(IIP) is a combined indicator. It is expressed in the form of an index number.This measures the short-term variations in the production volume of a basket of industrial goods during a particular time period with reference to a base time period. Thus, IIP is a short-term measure of industrial growth till the outcomes from Annual Survey of Industries (ASI) and National Accounts Statistics such as GDP are available. Base Year Value in IIP: The base year for IIP is always given a value of 100. The base year of IIP has been revised to 2011-2012 (in the month of May) This has been done in order to bring the IIP data at par with GDP data(GDP base year has been revised to 2011-2012). For Example:  Suppose the value of IIP in 2016 was 140. This means that there has been a 40%(140-100) increase in the industrial activities in India as compared to the industrial activities in 2011-2012. Calculation of IIP: The ...
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What is Capital market ?

What is Capital market ? A capital market is a financial market in which long-term debt or equity-backed securities are bought and sold. Capital markets channel the wealth of savers to those who can put it to long-term productive use, such as companies or governments making long-term investments Capital markets refer to the places where savings and investments are moved between suppliers of capital and those who are in need of capital. Capital markets consist of the primary market, where new securities are issued and sold, and the secondary market, where already-issued securities are traded between investors. The most common capital markets are the stock market and the bond market. The good capital market is a positive thing for the economy of a country.
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