Price rise does occur in the process of economic development. But in India the rise of price has been much higher than what it should have been.
Following are the causes of price rise:
(a) Black Marketing:
It broadly means holding the inventories and selling it at higher price. It creates artificial scarcity in the economy inspite of increase in production and results in price rise,
(6) Black money:
In 1999-2000 India has reported to have the circulation of Rs. 7800 crores as unrecorded money, i.e., Black Money in the country. Black money encourages the people to the demand of goods and services in the economy thereby leading to high rise in general price level.
(c) Rapid Growth of Population:
The rapid growth of population means more mouths to feed, more demand of clothing and basic necessities as compared to supply of goods and services which result in price rise.
(d) Deficit Financing:
It means printing more currency notes and coins. In India deficit financing is done mainly to meet the budgetary deficit. It results in more supply of money in the economy but when increase in supply of money corresponds with less increase in the supply of goods and services (National output) there is rise in price of goods and services.
(e) Increase in Money Supply:
Money supply includes currency notes and coins, demands and time deposits. Increase in money supply shows that people in an economy are ready to spend more money for buying goods and services.
A rise in price above market price causes over-supply since demand is lower than supply.
The causes of change in demand is due to the rise and fall of price.
Prices situation that emerged in India was because of international commodity prices and since India is no longer a closed economy here were global recession. Also, there was drought. Hence, the price rise.
The effect of inflation in India is an unbalanced relationship between the amount of money earned and the cost of regular goods. This relationship can be controlled by bank authorities by limiting inflation.
The demand curve will have a downward slope indicating ________ . A. the expansion of demand with a fall in price B. contraction of demand with a rise in price C. the expansion of demand with a fall in price and contraction of demand with a rise in price D. rise in price causes a rise in supply
Supply and demand is what causes house prices to rise. If there are few houses for sale, but many people looking to buy a house, the price of those few houses will rise.
because you are poor so they don't want to let you in
It causes the general price of products to slowly rise over time.
1.rise in price. if price will be higher than the budgeted price then unfavourable 2.shortage of suppliers. this led to increase in price
there are mainly 6 factors that are responsible for price rise 1.monetary factor 2.increasing population 3.availablity of raw material at high costs 4.price rise by the government 5.smuggling,hoarding and black marketing 6.black money
Increases in demand are shown by a shift to the right in the demand curve. This could be caused by a number of factors, including a rise in income, a rise in the price of a substitute or a fall in the price of a complement.
Generally prices rise when the is increased demand for a product (oil/petrol for example) or when there is a restriction in the supply (eg houses).