Measures to Control Inflation

&NewLine;<&excl;-- WP QUADS Content Ad Plugin v&period; 2&period;0&period;95 -->&NewLine;<div class&equals;"quads-location quads-ad1" id&equals;"quads-ad1" style&equals;"float&colon;left&semi;margin&colon;0px 0px 0px 0&semi;">&NewLine;&NewLine;<&sol;div>&NewLine;<h2>The demand side<&sol;h2>&NewLine;<h3>Control of Money Supply<&sol;h3>&NewLine;<p align&equals;"justify">The money supply has a great influence on the rising inflation that is&comma; inflation with increasing the money supply and vice versa&period; Therefore&comma; to control inflation&comma; measures must be taken to control the money supply&period; The money supply can be controlled with the help of monetary policy in which the central bank uses various methods&comma; such as bank rate policy&comma; open market operations&comma; changes in reserve requirements&comma; credit rationing &comma; direct action etc&period; All these methods are useful to control the rate of inflation in a country&period;<&sol;p>&NewLine;<h3>There is no Deficit Financing<&sol;h3>&NewLine;<p align&equals;"justify">Deficit financing shows that public spending beyond their income&period; The purpose of deficit financing is to meet the additional costs that the budget deficit&period; Because the money supply increases in the country and causes inflation&period; Therefore the deficit financing should be discouraged and all development costs must be met through taxes and debt&period;<&sol;p>&NewLine;<h3>Population Control<&sol;h3>&NewLine;<p align&equals;"justify">&lbrack;large&rsqb;In most developing countries&comma; the population is increasing very quickly that the production of goods and services does not increase at the same pace&period; Because the imbalance between supply and demand of goods and services are produced and cause inflation&period; Therefore&comma; to control inflation&comma; appropriate measures should be taken to control the population&period;<&sol;p>&NewLine;<h3>Fiscal Policy<&sol;h3>&NewLine;<p align&equals;"justify">Fiscal policy refers to government policy of public spending and taxes&period; The main fiscal policy objective is to maintain only the slight change in the general price level&period; During inflation&comma; the government tries to reduce its expenditure on unproductive activities and the direct tax rate increases so that the purchasing power of the population is reduced&period; Due to the reduction in the purchase of the population&comma; demand for goods and services will be reduced and controlled inflation&period;<&sol;p>&NewLine;<h3>Direct Measures<&sol;h3>&NewLine;<p align&equals;"justify">There are several other options available to the government to control inflation and wage and price freeze&comma; the rationing of goods&comma; establishment of public service shops&comma; the price review committees&comma; boards of price stabilization&comma; etc&period; This direct measures are often used by the government to control inflation&period;&NewLine;<&excl;-- WP QUADS Content Ad Plugin v&period; 2&period;0&period;95 -->&NewLine;<div class&equals;"quads-location quads-ad2" id&equals;"quads-ad2" style&equals;"float&colon;none&semi;margin&colon;0px 0 0px 0&semi;text-align&colon;center&semi;">&NewLine;&NewLine;<&sol;div>&NewLine;&NewLine;<&excl;-- WP QUADS Content Ad Plugin v&period; 2&period;0&period;95 -->&NewLine;<div class&equals;"quads-location quads-ad3" id&equals;"quads-ad3" style&equals;"float&colon;none&semi;margin&colon;0px&semi;">&NewLine;&NewLine;<&sol;div>&NewLine;&NewLine;