Question

Black Money is a cause of Inflation "Explain​

Answer 1

Answer:

Black Money means people have currency but the government has not any record of it.

Explanation:

So they use it to get the services of that money ultimately the demand will get increase and we all know that when the demand increases the price of the product or the service will increase and that is the inflation only.

Answer 2

Black Money ₹ :

• In its simplest form, black money is money on which tax is not paid to the government. ... The sellers in both examples have earned money from legal sources but evaded taxes. The most common source of black money is the black market or underground economy.

Black money is a cause of Inflation :

• Black Money on the other hand is one which cannot be traced. It is difficult to ascertain its origin. Why so? Well, there are two reasons:

• First, because it is in the form of cash.

• Second, if in the form of wired money, then the transactions are made in the fashion to cover the tracks, and money sent outside India to the banks of such countries where the Income tax is either very low or NIL, and where the Banks keep your information confidential. Thus, no information and no traceability.

• One thing that you should note here is that the money is very real, and INDIAN. That is to say that it has already been accounted for in your Economy. So then where is the problem whether Black money is here in India or not, if the money is already accounted?

Hope my answer helps you buddy!

Good night ♥

Sweet Dreams ♥