Name of the student- DHEERAJ DAWAR

Enrollment No- 02280301714

BBA- Semester II
(Evening Shift)
Batch: 2014-2017
Subject Code 104
Subject Business Economics II
Research Assignment
 ACKNOWLEDGEMENT
I offer my sincere thanks and humble regard to Rukmini Devi Institute of advance studies
,GGSIP University , New Delhi for imparting us very valuable professional training in BBA.

I pay my sincere regard to Ms.Sonam Goel my project guide for giving me the cream of his
knowledge. I am thankful to him as he has been a constant source of advice, motivation and
inspiration. I am also thankful to him for giving his suggestion and encouragement throughout
the project work.

I take the opportunity to express my gratitude and thanks to our computer Lab staff and library
staff for providing me opportunity to utilize their resource for completion of the project.

I am also thankful to my family for constantly motivating me to complete the project and
providing me an environment which enhanced my knowledge.

DHEERAJ DAWAR

BBA IInd Evening

Question
Compare Between Inflation V/S Deflation.
 INFLATION V/s DEFLATION
BASIS INFLATION
1. Definition Inflation is defined as the rise
in the price level of goods
and services in the economy.
During inflation the
purchasing power of money
decreases. A person buys
lesser quantity of goods than
before with the same amount
of money.
2. Investments In case of inflation people
tend to invest less as the
surplus money ios less.
3. Demand and In inflation, the demand for
supply of goods the goods decreases because
and services of of the high prices and the
supply increase as the seller
wants to maximize his profit
by selling more goods at
higher prices.
4. Taxes In inflation, the investors can
be imposed to hidden taxes
because the increased
earnings can push them to the
higher taxpayers bracket.
5. Rate of Interest Higher rate of interest is
charged by the reserve bank
of India to reduce the money
supply.
6. Printing The reserve bank of India will
Currency not print more bank notes.
7. Government In case of inflation, the
Spending government will have to
reduce its spending.
8. Reallocation Of During inflation, people have
Resources less purchasing power, at this
stage people can carefully
DEFLATON
Deflation can be defined as the fall in
the general price level of goods and
services in an economy. The
purchasing power of money
increases i.e. the real value of money
increases and an individual can buy
more quantity of goods than before
with the same amount of money.
In deflation people want to save
more as they have more surplus
money.
In deflation, the demand of goods
will increase because of the decrease
in the price of goods and the seller
will supply less amount of goods at
lower price because they dont want
to earn loses.
In deflation, the government will
have enforced the taxpayers to pay
taxes and at this stage the
government will decrease the interest
rate.
In this case, Reserve bank of India
reduce the interest rate for increases
the money supply in market.
The central bank will have to print
more bank notes to increase the
money supply in the market.
The government will have to
increase its expenditure to boost the
demand.
During deflation, people have higher
purchasing power but the demand is
falling down therefore people may
allocate their money and save more money.
made risk free investments.