Beruflich Dokumente
Kultur Dokumente
Group 9:
Abhinav Bura (PGP/21/125)
Ajitesh Kumar (PGP/21/130)
Mahak Malhotra (PGP/21/154)
Mohit Mishra (PGP/21/156)
Nirdesh Kumari (PGP/21/161)
Rishav Sharma (PGP/21/172)
Shirley Joshua (PGP/21/368)
QUESTIONS ANSWERED:
INTRODUCTION
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Leading indicators are measurable economic factors that can predict what will happen in
the economy. Leading indicators are, by definition, backed by solid economic theory and
tested by performance. In practice, composite leading indicators are used for any policy
decision making since composite scores will be more reliable than any individual leading
indicator movement. For example, stock market prices, avg. workweek etc.
Develop a trend-adjusted Select a set of leading Calculate composite Test leading indicators
business cycle indicators score in other geographies
First, a robust growth A set of leading indicators A composite score The leading indicators
cycle chronology was were selected basis calculated basis were tested for
developed to measure different business individual leading performance and accuracy
relative economic activity processes (See Table, indicators is generated in other geographies
by eliminating long-term slide 7) and tested for
trends. performance in US
Predicting market trends and impact on Investment: Investors will use leading indicators
to assess the performance of overall economy, or of special sectors of interest to safeguard
investment. Since the govts monetary policies maybe heavily impacted by CLIs, investors
can predict the government policy action & take appropriate measures.
Monitor growth cycles developments across nations: Leading indicator indices can be a
useful measure to assess the growth cycles for countries (contraction, expansion, recovery).
Also, leading indicators can be used to predict the growth of economic activity, like exports
and imports (by weighting the indices with exports of a country)
Sequential signal system for identifying start and ending of recessions: Compare target
growth rates with current rates basis leading indicators to trigger signals in 3 sequences:
preliminary, intermediate and final. The signals can trigger certain policy actions such as
release of government funds for public employment. Signals of recovery of economy would
be equally important to allow anti-recession policies to be terminated.
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Manufacturing
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
The impact that manufacturing will put onto GDP varies from country to country.
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Impact of Manufacturing
The ways in which manufacturing impacts economy can be amongst these:
- Production levels
- Employment
- Average weekly hours
- Inventory
- New orders
- Supplier delivery rate
This activity also has spillover benefits as when new goods are manufactured, more
workers are needed. This leads to an increase in the employment of the country.
Increased employment leads to wellness in the country. This wellness has other
qualitative benefits to a country in addition to improving the GDP of the economy.
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Manufacturing in India
After the election of Modi Government in 2014, various pushes by Govt. such
as Make in India have improved the levels of manufacturing in the country.
However, the various decisions of Govt. such as Demonetization, Goods and
Services Act(GST) have negatively impacted the manufacturing sector.
In the last few months, Manufacturing Purchasing Managers India (PMI) has
been increasing.
The Govt. is trying to push manufacturing by favorable economic policies,
better market conditions, advertising along with various new product
launches.
Taking into consideration all these factors, increase in manufacturing
indicates GDP of India increasing and evolving into a better and healthier
economy.
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Decrease
severe leads to recession to high increase in demand and
pressure to increase prices
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Theoretical reasons why stock price index can predict future economic activities.
we can clearly see from fig.1 that, in between 1986 to 1987, there has been a
growth in both Service and manufacturing services which contradicts the
prediction made from the stock market crash.
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Consumer Credit
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Consumer Credit: It is defined as the debt the consumer incurs while purchasing any kind of
goods and services. It can be classified into two parts:
1. Revolving credit: In revolving credit the consumer is allowed to withdraw funds whenever
is required by paying a certain amount of fees.
2. Installment credit: In installment credit the amount borrowed is paid in the regular
instalments which includes the interest and portion of the principle and eventually the full
It facilitate the lead in the retail purchase making consumer less dependent on the income, which
will drive the overall consumption as a result increase in the GDP of the economy.
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Figure shows the growth rate of the loans even though lending rate was slowed down to zero but the
economy had picked up after first few quarters and the patterns were quite moderate during the period
1990 to 2001 recession.
In contrast with the 2007 recession the growth has reduced drastically during the recession and remains
negative for almost the next four years
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
It has actually helped to boost up the consumer confidence which has helped to drive the
growth in the real estate market
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Studies shows great economic growth had preceded the rise in capital formation (e.g.
Kuznets, 1973, p. 129).
Many research works which says the reverse, that, rate of capital formation
determines rete of countries economic growth (e.g. de Long and Summers, 1991 and
1992).
Researchers use cross-section data or pooled time series to study the impact of capital
investment on economic growth and vice-versa. This data show economic growth
precedes capital investment. Table (1)
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Short coming of this method is that cross sectional differences among countries
reflects permanent characteristics of the countries that encourage or discourages the
investment or economic growth like efficiency of government, violence in the
country, degree of corruption etc.
The above kinds of relationships can give wrong inferences that fixed capital
formation resulted in high growth and vice-versa.
To eliminate the above problem, each variable can be divided by the average of that
variable over the period in which it is used. This eliminates inter-country
differences, which in turn makes regression weaker, but result is persistent. Table (2)
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Fourth Largest
Growing Economy in
terms of PPP (GDP:
3.36 trillion USD).
- These achievements
This revolution in the increased the
80s and 90s proved to significance of the
be immensely Indian economy in
beneficial to the the global scenario.
Second fastest
economy and helped
growing major - The need arose to
India achieve the Tenth Largest
economy with a forecast the
feats given alongside. Growing Economy
growth rate of performance of this
8.1% for the first in terms of
Exchange (GDP: growing economy
quarter of 2005- 691.87 billion USD).
06.
Balance of Payment
Human Development Index
Foreign Exchange Reserves
Electric Power Generation
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Its major components are (the relation between them being additive in nature):
Following is the graph that maps the GDP values for India over the last decade:
POPULAR INDIAN
MANUFACTURING FIXEDCAPITAL SUMMARY AND
INTRODUCTION LEADING STOCK PRICES CONSUMERCREDIT ECONOMIC
& INVENTORY INVESTMENT CONCLUSION
INDICATORS SCENARIO
Computation of Monsoon Index (Only four months, June through September are considered):
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