Inflation affects the value of money and the real burden of debt, and different levels of inflation have different impacts on economic growth and income distribution.
Consider the following statements: (a) Creeping inflation is conducive for economic growth and may have favourable effects. (b) During inflation value of money increases. (c) Inflation benefits debtors. (d) Inflation decreases the inequality of income. Which of the statement/s given above is/are correct ?
Asked in MPSC CS Prelims 2021 · Topic: Money & Banking (Inflation: Types, Causes, Effects, and Monetary Policy Responses)
More Economic Development questions
- With reference to inflation targeting by the Reserve Bank of India, consider the following statements: In May 2016, the RBI Act, 1934 was 1. amended to provide a statutory basis for the implementation of the flexible inflation targeting framework. Under Section 45ZA, the Central Govern‐ 2. ment, in consultation with the RBI, determines the inflation target in terms of the Consumer Price Index (CPI), once in five years. On March 31, 2021, the Central Govern‐ 3. ment retained the inflation target of 6 percent with the tolerance band of ± 2 percent for the next 5-year period - April 1, 2021 to March 31, 2026. Which of the above statements are correct?
- Stagflation is a situation of
- Which of the following fixed the four percent inflation target in India with tolerance level of +/- 2 percent for the period 2016 to 2021 ?
- Under this framework, the inflation target is set by the Government of India in consultation with the Reserve Bank of India. 352. Assertion (A) : Cost push inflation is caused by shift in aggregate supply curve. Reason (R) : Shift in aggregate supply curve takes place because of increase in wages.
- Consider the following statements regarding inflation : Statement (A) : Head-line inflation refers to the rate of change in the Consumer Price Index Number, a measure of the average price of a standard basket of goods and services consumed by a typical family. Statement (B) : Core inflation measures the change in average consumer prices after excluding from the Consumer Price Index certain items of volatile prices such as food and fuel. Of these statements,
- Which of the following statements is/are correct in respect of inflation in India ?
- Inflation adversely affects
- Assertion [A]: When price decreases, purchasing power increases, and vice versa. Reason [R]: When the production of goods decline, the price of goods increases and then the purchasing power is affected.
