It is now very clear that the economic impact of Covid19 is going to be far greater than anything that we've seen in the last fifty years, and far greater than the 2008 global financial crisis. People who are poor and middle-class are going to be the most hit in this situation world-wide especially in …
Category: Economics
Understanding GDP of India (by Be Money Aware Blog)
This is an excellent article written by Be Money Aware Blog on the basics of GDP interpretation and the mechanics behind that number. Here is the link to the original article. Overview of GDP GDP, or Gross Domestic Product, is the value of all goods and services produced in the economy over a period of …
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Cap and trade policy
Governments cannot leave it to the companies to control their emissions as companies don't have incentives to control their pollutants. Cap and trade is a regulatory system that is meant to reduce certain kinds of emissions and pollution and to provide companies with a profit incentive to reduce their pollution levels faster than their peers. …
Gross vs. Net
Gross: The term gross refers to the total amount made as a result of some activity. It can refer to things such as total profit or total sales. Net: Net (or Nett) refers to the amount left over after all deductions are made. Once the net value is attained, nothing further is subtracted. The net …
Impact of FSA on the FMCG companies
The new flagship programme from the UPA government is the Food Security Act (FSA). The scheme proposes to provide BPL families with 25kgs of grain (Rice & Wheat) per month at Rs. 3 per kg. This is a bold step towards right to food for the poor. Two major problems with this act now are: …
FMCG Distribution Network
The typical chain for a grocer store FMCG product will be: Manufacturing plant -> Company Ware House -> Regional Ware House -> Regional Stockist or Depot -> Super Stockist or Depot -> Stockist/Depot -> Distributor -> Retailer Main Godown -> C&F Agents/Super Stockists -> Distributors as per the territories -> Wholesalers/Retailers So, the retailers either …
Big Mac Index
The Big Mac Index is published by The Economist as an informal way of measuring the purchasing power parity (PPP) between two currencies and provides a test of the extent to which market exchange rates result in goods costing the same in different countries. It "seeks to make exchange-rate theory a bit more digestible". The …
Price Sensitivity Model
In the 1970s, Dutch economist Peter H. van Westendorp introduced a simple method to assess consumers’ price perception. It is based on the premise that there is a range of prices bounded bya maximum that a consumer is prepared to spend and a minimum below which credibility is indoubt. The Price Sensitivity Meter (sometimes called …
Bettering a billion lives, India’s Unique ID System
Chairman of the Unique Identification Authority of India, Nandan Nilekani, said over a third of India’s 1.1 billion consumers had been largely overlooked in areas such as banking and social services. Speaking to business leaders gathered at The Nielsen Company’s Consumer 360 event in New Delhi, Nilekani said this had come about in part because …
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The IMF and the World Bank relations to Neoliberalism
Neoliberalism “refers to the policies and processes whereby a relative handful of private interests are permitted to control as much as possible of social life in order to maximize their personal profit.” The major beneficiaries of neoliberalism are large trans-national corporations and wealthy investors. The implementation of neoliberal policies came into full force during the …
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Free Trade Warehouse Zones (FTWZs) and GST
The Government of India has allotted special zones called Free Trade Warehouses to promote trade. The advantage with these warehouses is companies can store there stock in these warehouses and can pay the customs duty only when they actually pull the stock out of the warehouse. For example, the a major petroleum corporation in Rajahmundry …
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