inflation - Current Dictionary

Yesterday I asked my mom to raise my allowance and I was sad. My mom says that when I was a child, I was saved even if I had less pocket money than I did. Once upon a time, it was 100 won for a fishbowl, 500 won for a dish of rice cake. Nowadays, they do not sell 1,000 pieces of rice cake. Also, yesterday, when I got 1,000 won, my notebook went up to 1,200 won. The value of the goods keeps rising, but my pocket money is in place, maybe it is good!

Causes and solutions of inflation - Why would price 1) rise?
If the price goes up and the value of the money
goes down, go to the mother and the market or a large mart. If the 500 won ice cream went up to 700 won, what was the value of money? You can say that the value of money has fallen because you have to spend 200 won more. In addition to the price of notebooks, the price of other commoditieswill increase and you will have to spend more money than now, so the value of money will be lower and you will need more money. Inflation is the price of money and the value of money. If your income does not rise as much at home, your income will be lowered, making life difficult.



Inflation Body Image 2
<Causes of inflation>
① demand inflation ( Demand, - pull inflation ): Demand inflation's happening because increase greatly neuleonaneunde supply to match it. If there is a lot of money in the household, the consumption will increase. This is called excess liquidity 2) supply.

② cost inflation ( Cost - the Push inflation ): products produced goes up the cost of the product price, the overall price rise, making all together. For example, if the price of imported oil rises, all products related to oil will rise. This is cost inflation.

③ Inflation is also the cause of mere shifts in demand, a rise in utility rates, and a lack of supply due to low productivity.

Inflation, which affects many places as
inflation rises, can be seen as a steady rise in prices, an increase in the volume of money3 ) , and a decline in the value of money. So inflation is also called malignant cancer of the economy. Inflation can be seen in four broad ways.



① Employees who receive a salary receive damages. I am glad that you raise your salary as prices rise, but most of them do not. So the income gap is worsening and the welfare of poor people is caused and the society becomes unstable.

② The person who will pay the debt is advantageous, and the person who will get the debt will be the disadvantage. It is because it is easy to pay off the debt by the fall of the value of money. The person who owes the debt is somehow financially difficult, and can be seen as a role to redistribute wealth.

③ If the price of the product is high, it will be exported at a higher price . Also, if the price of domestic goods is high, people who use imported goods will increase. It can be a factor in making the trade balance deficit.

④ If the value of money falls over time , you will lose money when you save. As a result the Bank is financing the sludge contains no capital to a lack ofIt will reduce lending and hinder economic growth.

The Influence of Inflation
If inflation raises prices, the widening income gap becomes more and more depressed, and the value of our currencies falls.
If the value of money declines, savings are reduced, the bank's capital becomes scarce, and it affects our economic growth.
What should I do to prevent inflation?
In order to lower prices, you have to reduce your money or increase your supply. Of course, both are good. When society has a lot of money, it encourages saving, and people increase supplies so that they do not have to buy a lot of goods. If the cause of inflation is due to the low production of a specific industry , it should increase the productivity of the sector and increase the supply by improving the distribution structure. For example, in dairy farming, if cows are sick and milk yields have fallen, then milk prices will rise for all milk products. The government then supports the dairy industry to fix the cows' disease and stabilize milk prices. We also use deflation policies . Deflation policies are policies that stabilize prices by curbing money, curbing demand, and reducing fiscal spending. After the Second World War, as inflation got worse, many countries laid out deflationary policies. But if deflation is too severe, the economy can get worse.