Inflation In Australia Essay

Moreover, as people lack jobs, they begin to perceive low quality items, as acceptable. This new perception can be great or bad news for international businesses, depending on their products and their prices. Those international businesses which tend to be bring products into the new market (country) that are cheaper than their domestic items, will be secured for business as their products will become more appealing to the consumers and less competitive than the native, Australian ones. On the other hand, more expensive businesses, will experience the struggle of persuading consumers that their precious money will not be going to waste.
Adding on, certain international businesses that are lurking for employees, might move to Australia, as …show more content…
Inflation Rate Likewise, to the problems risen regarding international business because of unemployment, the same situations businesses need to endure, when the inflation rate rises. This is because the purchasing power of an individual is reduced, as the amount of goods or services they would be able to buy is reduced in quantity. For instance, “if the inflation rate is 2% annually, then theoretically a $1 pack of gum will cost $1.02 in a year” (Hayes 1). As mentioned previously, when the cost of living increases in Australia, those businesses that sell expensive products will not be able to make grand amounts of profits, as the poor and middle class will be frugal and careful with their spending (Hayes 1). Furthermore, the inflation rate being higher than usual, would scare away potential international businesses as they would recognize that Australians are probably already having trouble making ends meet, so establishing a business there which would cost millions of dollars, would be useless. In contrast, those international businesses that are already very rich and have cheap products, would find Australia as a gold mine as there are many potential consumers who would love to save money and purchase cheap