Question

What measures adopted to reduce inflation

Answer 1

Explanation:

the three measures adopted to reduce inflation are-

1. Monetary Measures

2. Fiscal Measures:

3. Price Control:

Answer 2

From a macroeconomic standpoint,two most common measures or instruments to control or reduce inflation are monetary and fiscal policies.

Explanation:

• Inflation basically refers to an overall rise or increase in the price level of all the goods and services in the economy.The monetary and fiscal policies are the major instruments available to the government of any country to reduce or control inflationary effects in an economy.
• One of the prominent ways to check the impact of inflation could be to increase the interest rate by the central bank to reduce spending and raise the cost of financial borrowings which is a part of the monetary policy.
• Another important step the government can adopt is a contractionary or conservative fiscal policy which entails reduction in government spending or expenditure to consequently reduce aggregate demand and any demand pull inflationary effects.
• The other measures government can implement can be directed towards reducing or checking the supply pull inflation,which refers to an increase in prices of goods or service from the perspective of firms or companies due to various supply related reasons.