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प्रश्न
Explain its impact on the producers and salaried class.
उत्तर
It is a situation in which prices of goods and services persistently rise at a fast face.
(i) Impact on Producers:
Businessmen (i.e., entrepreneurs, traders, producers, etc.) tend to gain during inflation because
- prices of their inventories (stock of goods and raw material) go up and thereby- increasing their profits.
- prices rise at a faster rate than the cost of production.
- they are generally borrowers of money for business purposes.
Thus, inflation makes the rich (i.e., the business community) richer.
(ii) Impact on Wage and salary earners during inflation:
It is due to the reason that wages and salaries do not increase in the same proportion in which the prices or the cost of living rises. But those workers and employees who have formed strong trade unions stand to lose less in comparison to those who are not organised. Due to inflation, the purchasing power of money falls. As a result of it, fixed income earners tend to buy less amount of goods and services than before even when there is a little rise in their wages. In this way, inflation increases the economic burden of those persons who are not in a position to bear it. Therefore, it is rightly called unjust.
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- What is meant by inflation? 2
- How is creeping inflation different from waling inflation? 2
- Explain the impact of inflation on: 3
- Wage earners and salaried class
- The investors
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- What do you mean by division of labour? 2
- Explain any two advantages of division of labour. 3
- 'Labour as a factor of production differs from other factors of production.’ In this context explain any two features of labour. 2
The income of a person who carries the risk bearing function is called as ______.
What is the meaning of inflation?
Observe the relationship of the first pair of words and complete the second pair.
During inflation the debtors gain and ______ lose.
With reference to the picture given below answer the questions that follow:
- Define the concept.
- Explain any three types of the concept.
Read the following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below:
Assertion (A): Inflation is a continuous rise in the general price level.
Reason (R): Inflation increases standard of living.
Which of the following statements are true and which are false? Give reasons.
- Inflation refers to a persistent upward movement of the general price level.
- Inflation results in higher level of unemployment.
- Purchasing power of money falls when price level rises.
- Creditors gain during inflation.
- Creeping inflation is regarded essential for economic growth.
