Eps Case Study
Goods should have the same price In different countries when expressed in same currency Purchasing Power Parity is used to determine the adjustments that are required in the exchange rate such that when a good is brought in a country, its price should be the same when expressed in the same currency.
For a common man, it gives a clear picture of the degree to which the value of currency has increased or decreased when compared to other countries currency. Ex: An example of this would be: when we do online shopping many a times we see the rises of goods expressed In dollars but what we have to pay actually Is the rupee equivalent of the dollar in order to buy that product. Explain the term “Purchase Power Parity” with a suitable example 2.
Assuming all other factors remaining constant, what will be the effect of increase in Rep rate by RIB on: a.
Loans given by banks to consumers b. Deposits taken by banks from consumers c. GAP of the India d. Inflation rate of India Explain with proper reasoning When the rep rate increases, bank has to pay more interest to the central banks which leave the bank with less money.
Money flow in the market also decreases In such a situation following will be the outcomes a- Interest of the loans given by bank to the consumers will also Increase b- Bank Increases the deposit rate to attract consumers to deposit their money Into bank, this will allow bank to fill the hole created in their account due to increased rep rate c- Since increase in rep rate takes away the money from the market, money circulation in the market will decrease hence, the GAP of a country will also decrease d-
Inflation can be controlled from rising as people will have less money to spend on goods and services they want to enjoy. 3.
Write a short note on the disaster (flood) in Outranked. Highlight major facts, reasons & consequences. The flood in Outranked is one of the most devastating calamities in the history of mankind. Such is the effect that people are still not able to go past what they had to experience. Such can be the effect of water in its disastrous form.
The flood situation has also exposed the inability of our country and Its readiness to cope up with situations like this.
Weeks after the disaster hundreds of villages are still Inaccessible, people are still missing. Government Is not able to meet the needs of people who are struck over there I recently read an article on yahoo, how people are trying to use the havoc in Outranked as an opportunity to make money. They are forced to buy eatables such as Piranhas at RSI 250, 100 RSI for chips. Taxi drivers have increased their tariffs to 3- 4 times and what not.
It is such a shame on humanity. How calamities like this can can be used as a source of money. I Nils snows winner collocation Is moving.
Instead AT knelling ten people In need people are helping themselves. 4.
Write a short note on the controversy surrounding “Jet-Edited Deal” and its implication on Indian aviation sector. Jet- Edited deal is an outcome of the increase in the FED cap (up to 49%) that India has allowed in the aviation sector. In fact, this is the only deal which has struck since the cap was increased to 49%. The controversy that surrounds the Jet Edited deal is based on two grounds: I-Despite having only 24% stake in the company, Edited has he power to affects Jet’s business decisions.
FIB wanted more clarity on the “effective control and ownership” post the deal 2- SIB is also seeking clarifications from Jet on the effects of this deal on the shareholders of Jet Even after so much debate GO’, has ignored such concerns and allowed both these companies to go ahead with the deal. It is trying to use this deal and set an example for other countries in the world that India is ready to welcome FED with open arms even at the cost of mending its rule and by giving undue favors The question is what Edited is tenting by investing into a company which has a debt of about 2 billion dollars? – Recently the government has announced to increase the air traffic rights in the ABA- Dhabi routes to 36000 plus seats per week, needless to say who will be the major beneficiary from this.
2- Jet CEO was asked to leave to make way for Testis’s Gary Kenneth Toomey who will head the Operations post the deal. However, the only benefit that consumers will get from this deal such as low air fares, better facilities also cannot be ignored. 5. Write the differences between WHIP and ICP in India
WHIP: whole sale price Index ICP: consumer price index Bother of them is indices for calculation of the price of market basket of all the goods and services that is produced in a country. WHIP: Countries like India and many south Asian countries use WHIP as index of calculation.
This is the index that is used to measure the change in the average price level of goods traded in wholesale market. ICP: Countries like US use ICP as index of calculation. It is the price of goods and services bought for consumption purposes by households