Current Rate of Inflation in Pakistan
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Course. ECONOMIC ANALYSIS (522)
Level MBA
Course Code 522
Name of Student ZAFFAR ABBAS
Roll No AH505861
Semester spring 2012
Topic Assigned:
Discuss the current rate of inflation in Pakistan and its impact upon business sector.
Topic: Discuss the current rate of inflation in Pakistan and its impact upon business sector
INFLATION `
Inflation means a rise in prices of goods and services in an economy over a period of time. Inflation is caused by some demand side factors (Increase in money supply, Increase in income, Black money spending, Expansion of the Private Sector, Increasing Public Expenditures) and some Supply side factors (Shortage of factors of production, Industrial Disputes, Increase in exports (excess exports), Global factors, Neglecting the production of consumer goods).
EFFECTS OF INFLATION
Inflation effects the different sectors of the economy (Effects on the distribution of income and wealth, Effects on production, Effects on the Government, Effects on the Balance of Payment, Effects on Monetary Policy, Effects on Social Sector, Effects on Political environment) and different classes of the people (Debtors & Creditors, Salaried Class, Wages earners, Fixed income group, Investors and shareholders, Businessmen, Agriculturists).
CAUSES OF INLATION
There are many causes for inflation, depending on a number of factors. For example, inflation can happen when governments print an excess of money to deal with a crisis. When any extra money is created, it will increase some societal group’s buying power. All sectors in the economy try to buy more than the economy can produce. Shortages are then created and merchants lose business. In the end, the price level rises.
Another common reason of inflation is a rise in production costs, which leads to an increase in the price of the final product. For example,
Course. ECONOMIC ANALYSIS (522)
Level MBA
Course Code 522
Name of Student ZAFFAR ABBAS
Roll No AH505861
Semester spring 2012
Topic Assigned:
Discuss the current rate of inflation in Pakistan and its impact upon business sector.
Topic: Discuss the current rate of inflation in Pakistan and its impact upon business sector
INFLATION `
Inflation means a rise in prices of goods and services in an economy over a period of time. Inflation is caused by some demand side factors (Increase in money supply, Increase in income, Black money spending, Expansion of the Private Sector, Increasing Public Expenditures) and some Supply side factors (Shortage of factors of production, Industrial Disputes, Increase in exports (excess exports), Global factors, Neglecting the production of consumer goods).
EFFECTS OF INFLATION
Inflation effects the different sectors of the economy (Effects on the distribution of income and wealth, Effects on production, Effects on the Government, Effects on the Balance of Payment, Effects on Monetary Policy, Effects on Social Sector, Effects on Political environment) and different classes of the people (Debtors & Creditors, Salaried Class, Wages earners, Fixed income group, Investors and shareholders, Businessmen, Agriculturists).
CAUSES OF INLATION
There are many causes for inflation, depending on a number of factors. For example, inflation can happen when governments print an excess of money to deal with a crisis. When any extra money is created, it will increase some societal group’s buying power. All sectors in the economy try to buy more than the economy can produce. Shortages are then created and merchants lose business. In the end, the price level rises.
Another common reason of inflation is a rise in production costs, which leads to an increase in the price of the final product. For example,