Some Fundaes

The Reserve Bank of India (RBI) determines how much new money should be made each year and how many old bills and coins should be taken out of circulation. When the RBI increases the money supply, the economy grows and jobs increase. When the RBI slows the money supply to combat inflation, the economy slows down and unemployment increases. Inflation is when there is a lot of money in circulation so prices rise and there is still enough money in people's pockets to pay high prices. The opposite of inflation is recession. This happens when prices are too high, and consumer demand for goods slows down. Prices must decrease so people still buy things, but companies don't make as much money and have to lay off workers. The Government tries to monitor this economic cycle, and sets policies to control the forces which drive the economy.

--- The author for the above is not me.