swayam007

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About swayam007

  • Rank
    Opening Up
  • Birthday 11/24/1992

Civil Service Bio

  • Optional Subject
    Electrical Engineering
  • Location
    Ahmedabad
  1. Regarding gold, i think the reason it's demand is high unlike reality because it is easy to buy gold. e.g. You buy a flat in Ahmedabad, first you are set for long negotiations to fix the price with seller.. then you have to go to AUDA, bribe govt officials there, etc.. it takes lot of time, now think if you bought it by taking loan from SBI - that means you need to put your valuable things as collateral , you actually do not own the house untill you have repaid the loan... now if you need to buy gold - go to SBI , there is a fixed price. Buy 1kg of gold .. that's all. Also, you can gift gold, you can get ornaments , exchange is easy... & We Indians love gold, in India there is always demand of gold... gold is required in wedding, diwali, etc.. it is very less likely that demand can go down ^^^ I hope my explanation is correct
  2. I am not sure whether my explanation is correct or not ... but here it is................. Value of a commodity depends on demand & supply. Consider this case, initially A flat cost Rs 10 lakhs & there was a huge demand of flats in a city. So, because of this huge demand, price of flats shot up & flat cost 20 lakhs now. Seeing the increasing value of flats , Anna takes loan of 20 lakh for a duration of 5 years, from SBI & SBI charges 10 % interest per annum. So, he has to pay 1 lakh (total interest) more. Now , Is he going to sell it for 20 lacs, no .. obviously, he will sell it for > 21 lacs say around 30 lacs. Also, speculation leads to further increase of price e.g. neighbours telling each other that prices will increase in next coming months. Now , the prices of flat shot up but income of public did not increase by same measure , so now they can't even buy the flats by taking loan. Now demand decreased. Now Anna knows that no one is going to buy his flat for 30 lacs. So he decides he will sell it for 25 lacs. Now people are not willing to buy for 25 lacs because they know that market is saturated, demand is low , hence prices will come down in coming months. this leads to speculation, eg your uncle telling you don't invest in flats , prices are going to drop. & hence there is slump in reality market
  3. Ramesh singh page 7.5 Inflation tax - Inflation erodes the value of money & the people who hold currency suffer in this process - As govt have authority of printing & circulating currency (as they do in case of deficit financing) this act functions as an income to govt - this looks as if inflation is working as tax - it means , inflation is always the level to which govt may go for deficit financing - level of deficit financing is directly reflected by rate of inflation *** Q. Can anyone explain it in simple way ? maybe by using some hypothetical case - X has 200 rs but inflation is 5 % .....
  4. Inflation Tax ^ this is a good article , you may find it pretty interesting Inflation can also produce a tax bonus for the government because of the way it affects wealth. If there is no inflation and a person has $10,000 in a savings account earning $300 a year in interest, the $300 is income because real wealth is increasing. But if the rate of price increase is 6%, then the real purchasing power of the $10,000 is decreasing and the $300 interest does not fully compensate for this. When inflation is taken into account, there should be a negative entry of $566 because the purchasing power of the original $10,000 has shrunk to $9434 in the second year. Thus the owner of this savings account has suffered an actual loss of about $266. However, the tax laws can and often do ignore the effects of changing real values, and the owner of the account may find that he pays taxes, even though in real terms (that is, in terms of purchasing power) he has no income at all.1 ^^ can anyone explain what does it mean ? So, putting money in saving account , actually leads to loss , if inflation rate is higher than interest rate on deposits??
  5. What is the relationship between fiscal deficit & inflation?
  6. Inflation Tax ^ this is a good article , you may find it pretty interesting Inflation can also produce a tax bonus for the government because of the way it affects wealth. If there is no inflation and a person has $10,000 in a savings account earning $300 a year in interest, the $300 is income because real wealth is increasing. But if the rate of price increase is 6%, then the real purchasing power of the $10,000 is decreasing and the $300 interest does not fully compensate for this. When inflation is taken into account, there should be a negative entry of $566 because the purchasing power of the original $10,000 has shrunk to $9434 in the second year. Thus the owner of this savings account has suffered an actual loss of about $266. However, the tax laws can and often do ignore the effects of changing real values, and the owner of the account may find that he pays taxes, even though in real terms (that is, in terms of purchasing power) he has no income at all.1 ^^ can anyone explain what does it mean ? So, putting money in saving account , actually leads to loss , if inflation rate is higher than interest rate on deposits??
  7. Ramesh singh page 7.5 Inflation tax - Inflation erodes the value of money & the people who hold currency suffer in this process - As govt have authority of printing & circulating currency (as they do in case of deficit financing) this act functions as an income to govt - this looks as if inflation is working as tax - it means , inflation is always the level to which govt may go for deficit financing - level of deficit financing is directly reflected by rate of inflation *** Q. Can anyone explain it in simple way ? maybe by using some hypothetical case - X has 200 rs but inflation is 5 % .....
  8. i also read an article about the case of Bangladesh in Hindu .. but could not link that with my doubt...thanx ...
  9. i think Pub Ad + maths is better.. engineering optional are not considered good these days.. Pub Ad is very good optional ... read this http://mrunal.org/2012/03/strategy-studyplan-public.html
  10. hi , i advice you to start reading some basic GS stuff & Hindu everyday
  11. hi , NCERT books might help you
  12. - If population is to guaranteed with minimum level of quality-enhancing input (e.g. food, health, education) - Minimum level of income should be guaranteed to them - Income is generated by productive activities- If population is to guaranteed with minimum level of quality-enhancing input (e.g. food, health, education) - Minimum level of income should be guaranteed to them - Income is generated by productive activities ð To ensure higher Development we need to assure higher Growth then how high development is possible when growth is low? can anyone give example of this case.(Low Growth & High development)
  13. - If population is to guaranteed with minimum level of quality-enhancing input (e.g. food, health, education) - Minimum level of income should be guaranteed to them - Income is generated by productive activities- If population is to guaranteed with minimum level of quality-enhancing input (e.g. food, health, education) - Minimum level of income should be guaranteed to them - Income is generated by productive activities ð To ensure higher Development we need to assure higher Growth then how high development is possible when growth is low? can anyone give example of this case.(Low Growth & High development)
  14. Higher rate of depreciation will reduce the tax burden.... For example.. Let tax rate be 30% on profits.. and cost of vehicle be 10,00,000 Case 1 : Depreciation rate 20% Say profit before claiming depreciation be 5,00,000 Depreciation = 10,00,000 x 20% = 2,00,000 Profit after depreciation = 5,00,000 - 2,00,000 = 3,00,000 Tax payable = 3,00,000 x 30% = 90,000 Case 2 : Depreciation rate 40% Depreciation = 10,00,000 x 40% = 4,00,000 Profit after depreciation = 5,00,000 - 4,00,000 = 1,00,000 Tax payable = 1,00,000 x 30% = 30,000 Therefore the demand for goods increase when corporates are allowed to claim depreciation at higher rates. ///////////////////////////////////// this is Akhi567's reply to the same question in Economics subject discussion