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  • Ph.D.
  • 2602

Short excerpt:

Inflation is an unpredictable economic condition which has positive as well as negative impacts on financial market. When the demand is more than available supply, there will be an upward movement in the prices of goods and services. This condition along with a decline in the value of money constitutes inflation. Consumer Price Index and Product Price Index are the tools used to measure the inflation rate. The diminution of the purchasing power of money is the most adverse effect of inflation, which prevents customers from acquiring as much goods and services they were able to purchase in the past. Similarly, inflation causes uncertainty about future and this situation will discourage savings and investments. In addition to this, inflation promotes speculation and hoarding since people

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