India is the developing country. The farm field is the prior base in the economy of India. There are many farmers who live in the rural area therefore they prefer the cash transaction. During the period of demonetization winter season is the prime season for the farmers and during this season, the farmers are in need of seeds to farm their land. To purchase the seeds they are in need of cash amount. The new currency notes are not enough available into the market so these farmers were suffered to farm their land without the seeds. In need of money farmers had to sell their grocery, vegetables with low cost and daily farm labors did not get their wages. Most of the common businesses suffer due this demonetization. The demand into the market is not up to the mark or effective so this act directly affected to the production process of the business. The production graph is low during the month of November and due to this, less demand into the market resulted into the unemployment for the daily wages or the common people. to pay the cash amount to the workers company has shortage of cash amount and not only that the common people suffer to get exchange of 2000 new currency note into the market. People collected the 500 rupees note and do not make active into the market to purchase the product. These resulted into the less force of currency use. As per the Phisher formula MV=PT. When M is controlled by the system is directly affected to V. Therefore, P (price level) and T (quantity) affected. In India majority of the people are using the cash transaction therefore, we noticed the effect of demonetization in to the market place.
Cite this article:
Amishaben N. Prajapati; Effect of Demonetization on Indian Economy. International Journal of Advances in Social Sciences. 2023; 11(4):218-2. doi: 10.52711/2454-2679.2023.00034
Amishaben N. Prajapati; Effect of Demonetization on Indian Economy. International Journal of Advances in Social Sciences. 2023; 11(4):218-2. doi: 10.52711/2454-2679.2023.00034 Available on: https://ijassonline.in/AbstractView.aspx?PID=2023-11-4-3
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