Inflation

Cards (5)

What is inflation?
The general increase in prices over time
What happens if inflation is high?
Increase in the cost of raw materials decreasing profit margins
Employees demand higher wages
How does high inflation impact strategic decision-making?
Cost minimisation
Price increase
Set higher wages
How does low/stable inflation impact strategic decision-making?
Encourages investment and long-term planning
How does high inflation impact operational decision-making?
May look for cheaper suppliers
May implement lean production