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Bahasa Inggris Niaga Tugas 2

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1.

Free trade which is a system in the country's economy also provides other benefits, namely increasing
the country's foreign exchange. Free trade characterized by export and import activities as well as
investment by foreign investors can increase the country's foreign exchange.

Indonesia's decision to sign a free market trade agreement is very beneficial for the Indonesian economy
because the free market is an economic exchange system in which taxes, quality control, quotas, tariffs,
and other forms of centralized economic intervention by the government are minimal or even non-
existent. So it can be concluded that the free market is trade that is not regulated by a coercive
authority such as the government. In a free market, taxes and customs duties on goods entering or
leaving a country will usually be abolished.

The free market can open up economic opportunities by expanding the market. Products that were
originally produced to be sold domestically, can be sold abroad easily. The absence of taxes makes the
market wider because it is not limited by expensive international taxes. The open market allows
domestic producers to export goods in large quantities but with low export costs. This makes the
country have superior export commodities that can boost the economy. Improving the economy The
implementation of a free market aims to increase state revenues as well as the economy of its
population. The broad market provides greater demand for products for domestic producers. The more
market demand, the greater the economic growth that will occur. In addition, the wide opening of the
market invites foreign investors to set up businesses in the country. Opening a new business or
developing a larger business can provide employment opportunities. This can reduce unemployment
and increase people's per capita income. Improving technology The free market allows more advanced
technology from abroad to enter easily into the country. With the free market, technological
improvement can be done easily and evenly. In addition to improving technology, intense free market
competition also demands an increase in a country's human resources.

Fulfilling domestic needs Free markets help the government to meet domestic needs. Not all goods can
be produced domestically, some goods must be imported to meet demand. The absence of import costs
and tight competition due to the free market allows the government to meet domestic needs at lower
prices. Functions of Free Markets Free markets have the main function of increasing the economic
activity of a region and giving its people freedom in conducting transactions

without any coercion from the government. The free market also functions as a source of information
about the availability, demand, and prices of goods, encouraging business development, encouraging
human resource development, boosting productivity, and improving the economy.

2. Inflation can be interpreted as an increase in the price of goods and services in general and
continuously within a certain period of time. Deflation is the opposite of inflation, namely a decrease in
the price of goods in general and continuously.
Inflation calculation done by the Central Bureau of Statistics (BPS), link to SEKI-CPI metadata. An
increase in the price of just one or two goods cannot be called inflation unless the increase extends (or
causes price increases) to other goods.

Low and stable inflation is a prerequisite for sustainable economic growth which in turn will provide
benefits for improving people's welfare. The importance of controlling inflation is based on the
consideration that high and unstable inflation has a negative impact on the socio-economic conditions of
society.

Bank Indonesia's monetary policy is aimed at managing price pressures originating from the aggregate
demand side (demand management) relative to supply side conditions. Monetary policy is not intended
to respond to rising inflation caused by surprise and temporary factors that will disappear by themselves
over time.

Meanwhile, inflation can also be influenced by factors originating from the supply side or shocks, such as
rising world oil prices and crop disturbances or floods. Of the weights in the CPI basket, the inflation
weight which is influenced by supply and shock factors is represented by the volatile food and
administered prices groups which account for approximately 40% of the CPI weight.

The parties who will gain and lose from inflation are the parties who benefit from inflation, namely:
Entrepreneurs Traders Speculators Borrowers There are also parties who suffer losses during inflation,
namely: Fixed Income Consumers Contractors or Contractors Creditors Savers

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