Table of content

Abstract
1 TITLE: Impact Of Inflation On Consumer
2 Introduction
3 Literature Review
3.1 Impact of Inflation
3.2 Consumer Buying Behavior
3.2.1 Characteristic of Consumer
3.3 Consumer Buying Decision Process
4 Conceptual Framework
5 Data Analysis And Interpretation
5.1 Introduction
5.2 Research Design
5.3 Research Approach
5.4 Sample Design
5.5 Data Collection
5.6 Data Analysis
6 Findings
7 Discussion and Conclusion
8 Suggestions
9 Problem Statement
9.1 Knowledge Gap
10 Objectives
1
 10.1 General Objective
10.2 Specific Objectives
11 Appendices
12 References
13 Research Questions

2
 Abstract

Measures of core inflation are intended to separate the underlying inflationary trend from the
headline measure of inflation, and they are regarded as the part of price change due to monetary
events. Core inflation may be viewed in this light as a significant signal of inflation trends that is
helpful for the implementation of monetary policy. The Central Bank of Sri Lanka believes that
to effectively implement its monetary policy, it is essential to track and analyze a reliable
indicator of Sri Lanka's long-term underlying trend inflation. As a result, several attempts to
gather and analyze representative measurements of core inflation have been attempted. This
document includes a variety of core inflation measures that were built using various approaches
in recognition of the need to investigate alternative core inflation measures for Sri Lanka. This
also focuses on examining the reliability of utilizing core inflation as a primary input in the
formulation of monetary policy and for predicting future inflation developments. There are
questions about the use of core inflation as a guiding indicator since different measurements
yield inconsistent outcomes when it comes to meeting the performance criteria of a
representative core inflation measure. While certain metrics do a good job of predicting the
future course of inflation, none of the basic measures excel at doing so in Sri Lanka.

This may not totally be the result of the inadequacies in the core inflation measurements, though,
since there may be problems with the headline inflation statistics. Since core inflation serves as a
crucial variable in tracking current underlying inflation and explains the dynamics of inflation to
help guide monetary policy, these results do not invalidate the usefulness of core inflation for
formulating policies and conducting analytical tasks. Indicators of core inflation based on
alternative methodologies can offer Sri Lankan monetary policymakers more up-to-date data in
addition to the official measure of core inflation currently use.

3
 1 TITLE: Impact Of Inflation On Consumer Behaviour

Inflation has a profound effect on consumer behavior by compelling individuals to

modify their spending and saving habits. As the cost of goods and services rises,
consumers often prioritize essential purchases over non-essential ones, leading
to a noticeable shift in consumption patterns. For instance, they might opt for
cheaper alternatives, buy in bulk to save money, or take advantage of discounts
and promotions to manage their budgets more effectively. This adjustment is not
just about immediate cost savings; it's also driven by a heightened sense of
uncertainty about future financial stability. Inflationary pressures can erode
consumer confidence, making people more cautious with their expenditures and
more focused on building their savings as a buffer against economic instability.

Furthermore, inflation can significantly impact brand loyalty and consumer

preferences. As prices rise, consumers are more likely to switch to less expensive
brands or generic products, seeking better value for their money. This behavior is
particularly pronounced among lower-income households, which allocate a larger
portion of their income to essentials and are more sensitive to price increases. In
contrast, higher-income groups might have more flexibility to absorb these cost
increases without drastically changing their lifestyles. Over time, prolonged
periods of inflation can lead to long-term behavioral changes, such as increased
price sensitivity and a greater emphasis on value-for-money purchases. These
shifts not only affect individual purchasing decisions but also have broader
economic implications, influencing market dynamics and the overall economic
landscape. Retailers and businesses must adapt by employing strategies like
dynamic pricing, enhanced promotions, and improved value propositions to retain
their customer base during inflationary periods.

4
2 Introduction

Most nations continue to experience inflation as an economic reality. Inflation is defined as an

increase in the average price level of goods and services over a sustained period in an economy.
Each unit of cash may purchase fewer products and services when the general price level
increases. As a result of the internal medium of exchange and unit of account inside the economy
losing actual value, inflation also represents a decline in the buying power of money. The impact
of inflation on an economy may be both good and detrimental at the same time. A rise in the
opportunity cost of keeping money, uncertainty about future inflation that may deter investment
and savings, and, if inflation is rapid enough, shortages of commodities as consumers start
stockpiling in anticipation of price increases in the future, are some negative impacts of inflation.
The ability of central banks to alter real interest rates as well as the promotion of investment in
non-monetary capital projects are positive consequences.

5
3 Literature Review

In economics, inflation refers to an increase in the average price level of products and services
over time. When prices are rising generally, a given unit of cash may buy fewer products and
services. As encapsulated by the frequently repeated adage that inflation is defined as "too much
money chasing too few things," inflation has historically been inextricably related to money.
According to (Anyanwu, 1993), inflation is a condition when there is an excessive demand for
goods across the board in the economy. This suggests that, given the available production
resources, the amount of expenditure being focused on home-produced items may be achieved in
the long run.

Not all instances of price inflation are alarming, even when it depreciates the value of people's
and companies' money. The Federal Reserve, the central bank of the United States, utilizes
monetary policy to target an annual inflation rate of 2% because economists contend that a
healthy, expanding economy need a low but positive level of price inflation. The "Goldilocks
zone" for good economic growth without significant risk of growing unemployment is often seen
as inflation of roughly 2% annually. Inflation effects can become unpredictable as they ripple
through the economy and affect consumers' behaviors in both rational and irrational ways if the
rate of inflation rises too far above the target. The country runs the risk of its economy stagnating
if the rate of inflation falls too far below that target. Inflation effects can become unpredictable as
they ripple through the economy and affect buyers' behaviors in both rational and emotional
ways if the rate of inflation rises too far above the target. If the rate of inflation falls too far
below that target, the country runs the risk of an economy that stagnates. (Anon., n.d.).

Ghana is now experiencing inflation, which is the most worrying aspect of its macroeconomic
predicament. The Ghanaian government is concerned about the effects it would have on private
consumer expenditure and the nation's economic growth due to its rising rate and effective
measures. As was previously said, there are several reasons of inflation. One of the main reasons
for inflation in a country is due to macroeconomic issues. The primary macroeconomic variables
in Ghana's scenario that contribute to inflation are the real exchange rate and the money supply.
While exchange rate depreciation lowers the pace of inflation, increases in real output or
spending as well as the money supply put upward pressure on price levels (Olusola, et al., n.d.).

6
3.1 Impact of Inflation

The effects of inflation on growth, productivity, and production have been hotly contested topics
in macroeconomics. Theoretical models in the literature on money and growth analyze how
inflation affects growth with a particular focus on how it affects the steady-state equilibrium of
capital per capita and output (Orphenides & Solow.M.Robort, 1990). The cost of inflation has
been transferred onto retirees whose income is fixed, and it has a variety of negative effects on
economic growth. For instance, these seniors would not be able to purchase the same number of
items as prices for products and services rise. Because the economy needs a certain amount of
savings to support investment, which increases economic growth, this discourages saving and
lowers economic growth.

3.2 Consumer Buying Behavior

Consumer behavior is the activities and behaviors of individuals and groups who buy and utilize
economic goods and services, as well as the influences on these behaviors. - JF Engel

Process by which people look for, choose, buy, utilize, and dispose of things and services to
fulfill their needs and desires. Buying Behavior is the thinking and doing of those who engage in
purchasing.

3.2.1 Characteristic of Consumer Behavior

The chief characteristics of the consumer behavior are as follow,

(1)It consists of the mental and physical actions that customers conduct in order to acquire goods
and services and feel satisfied by them. It includes both outward behaviors like browsing the
aisles of the market to check out the goods and making a purchase and inward behaviors like
developing attitudes, noticing advertisements, and coming to prefer certain brands.

(2)Consumer behavior is highly complex, dynamic, and ever -changing. Therefore, management
must adapt to the shift or the market may become very comp etitive.

The internal factors; such as needs, motives, perceptions, and attitudes as well as the external
environmental factors; such as family social groups, culture, economics, and business influences
7
 have an impact on an individual's particular market behavior. Consumer behavior is the term
used to describe the thought and feeling processes as well as the observable behavior of
consumers during the selection, purchase, and use of a good or service. Studying consumer
behavior involves looking at how, wha t, when, and why people buy. It incorporates concepts
from anthropology, psychology, sociology, sociopsychology, and sociology. The impact of social
groupings like family, friends, reference groups, and society at large on the consumer is also
evaluated. Buyer behavior has two components: the actual purchase activity, which is visible to
observers, and the in-depth or quick decision-making process, which may involve the interaction
of several complex variables that are hidden from observers.

3.3 Consumer Buying Decision Process

The procedure by which consumers determine their needs, gather data, weigh options, and make
a buying decision. These decisions are made based on psychological and financial
considerations, and environmental considerations including cultural, social, and group values
have an impact as well. the beginning of the purchasing selection processes every day, consumers
make a variety of purchases. To find out what consumers purchase, where they buy it, how they
buy it, how much they pay, when they buy it, and why they buy it, mostly large corporations
conduct substantial consumer buying decision research. Every purchase involves a different stage
for the buyer, although for more commonplace purchases, they frequently skip or reverse parts of
these stages.

4 Conceptual Framework

8
 Independent Variable Dependent Variable

Consumer
Inflation Rate Income Level
Expenditure Level

5 Data Analysis And Interpretation

5.1 Introduction

Under this section provide using research methodology to overcome the key issues, knowledge
gap and to achieve the developed objectives. And this section describes research design, research
approach, sample design and the data collection. Those are aligned with the research problems
and the objectives.

5.2 Research Design

Research design is a master plan of the research project. This research regarding with the issues
relating to the objectives. It is process of collecting and analyzing the quantitative data. This
research had not studied in previously in Sri Lanka, therefore can identify this research is an
exploratory type of research. This research tries to find out the relationship between current
inflation and the consumer behavior “experiences of a biscuit company in Sri Lanka”.

5.3 Research Approach

9
The research approach is plans and the procedures of the research. Under this approach consists
the flow of process with broad assumptions to detailed methods of data collecting, analyzing and
interpreting to achieve the objectives. This approach includes quantitative data collection
methods. Further, data will gather from online questionnaire survey to find out the relationship
between current inflation and the consumer behavior “experiences of a biscuit company in Sri
Lanka”. Questionnaire method used to gather data from the consumers to know about their
attitudes, experiences and opinions.

5.4 Sample Design

This research considers the relationship between current inflation and the consumer behavior
“experiences of a biscuit company in Sri Lanka”. To analyze the data, we collect data through
online questionnaire by delivering to target population. Our target population is consumers. The
sample frame of this study is 35 consumers and use probability sampling method use for gather
data. This technique represents the whole population to produce the result to achieve the
objectives. Under this technique, use simple random sampling method, which mean every
member of the population getting chances to being selected for the sample.

5.5 Data Collection

The data collection method is to study to collect the required data through online questionnaire
form.

5.6 Data Analysis

All objectives of the research will achieve by using quantitative data and qualitative data. And
analyze the data using pie charts.

6 Findings

10
 01. Gender

Figure 1: Gender

Among the 35 responses, majority of gender ‘Male’ has involved into provide the information
and the percentage is 54.3%. Gender ‘Female’ has involved as 45.7%.

02. Employee Status

Figure 2:Employee Status

Above figure exhibits the employability of the sample gathered, as evident the majority of the
sample is employed and as a percentage it is 74.3%. There are a smaller number of participants
who are unemployed, in terms percentage it is 25.7%.

03. What is your monthly income level of customer?

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 Figure 3: Monthly Income Level

Above figure exhibits the income of the sample size, as evident the majority of the sample has a
monthly income of more than Rs.55000. In this study it is also found that there are some
respondents who belong to the income group of less than Rs.15000 per month. Whereas
14.3% ,11.4% and 8.6% respondents belongs to the income group of Rs. 35,000 - 55,000,
25,000-35,000 and Rs.15,000-25,000 respectively. 04. What is your monthly expenses level?

Figure 4: Monthly Expenses Level

This figure shows monthly expenses level of consumers. Out of the sample sized 22.9% precent
are spending money more than Rs.55,000 monthly expenses level and Rs.10,001 – 20,000 range
level. And 20% precent spending under the less than Rs.10,000 expenses level range. From this
study, it is observed that majority of the respondents have both low and high purchasing capacity
comparing with the income ranges. 05. What would you most have preferred biscuit in Sri
Lanka? Reason for that?

12
 Marie
 CBL Munchee
 Maliban chick bits
 Munchee
 Cream cracker
 Mari
 CBL
 Maliban - Unique taste
 Spicy cracker
 Cream Cracker.
 Custard Cream Biscuits
 Chick bits
 It is good
 Chocalate Biscuit
 Chick Bits - Because of its flavor
 Hawai cookies
 Chocolate biscuit love it
 Munchee biscuits and those are tastier than other biscuits
 Munchee
 Chocolate biscuit / It's very testy
 Cherish chocolate biscuit
 Lemon puff
 Manchee and Maliban
 CHOCOLATE BISCUITS

 Cream cracker. Good for the price

 Any biscuit
 Ceylon Biscuits I prefer it because they still us and produces good products to their
customers

13
  Snack cracker
 CBL
 CBL
 Milk short cake biscuit
 Maliban
 Chocolate biscuit

 Munchee lemon puff. Like the taste.

Out of the result majority of respondents suggested that they most preferred biscuits are
chocolate biscuits, Marie and cream cracker biscuits. Also, they have mentioned CBL Munchee
and Maliban biscuits are the most preferred biscuit in Sri Lanka. Reason for that is unique tasty,
good quality and providing products for fair prices. 06. What is preferred brand in Sri Lanka?

Figure 5: Biscuit Brands

This data presented the brands preferred by the respondents. Out of thirty-five respondents,
54.3% of the respondents are buying CBL biscuits and 42.9% are buying Maliban biscuit.
Cherish
biscuits has a smaller number of respondents. From this study it is observed that
majority respondents are consumer of CBL biscuits. So CBL is the most preferred brand in the
area. 07. Who is the decision maker for purchasing biscuit in a family?

14
 Figure 6: Decision maker when purchasing biscuits

The above figure shows that according to thirty-five respondents 37.1% of the respondents
Children are the decision makers for purchasing biscuits and 25.7% respondents says that
Mothers are the decision makers for purchasing biscuit. There are also some respondents
according to whom Fathers 20% and other members 17.1% are the decision makers regarding
consumption of biscuit in their families. Thus, it can be revealed from the study that in majority
of the respondents’ family children are the decision maker for purchasing biscuits.
08. Habit of consuming biscuits

Figure 7: Habit of Consuming Biscuits

Out of the sample majority of respondents are consuming biscuits in rarely it shows 42.9%
percentage. The reason for that is due to the inflation, price of the biscuits rises therefore
consumers purchasing power going down and because of that consumer reduce the purchasing

15
biscuits and rarely they consume the biscuits. And 40% percentage shows consumed biscuits
regularly. And
17.1% consumed biscuits often. 09. What is the factor or factors influencing for

buying decision of biscuits?

Figure 8: Factors influencing for purchasing biscuits

The data in the above bar chart shows the factors which influence the buying decision of
respondents while purchasing biscuits. Above graph shows that 30 respondents give importance to
taste, 5 respondents give importance to company’s goodwill.16 and 7 respondents are influenced
by price and packaging respectively. 5 respondents are influenced by availability, whereas 2
respondents are influenced by other factors of the biscuit while buying biscuit. Thus, the study
shows that the respondents are mostly influential by taste, product quality and price while

purchasing biscuit. 10. What is the affordability price you can bare for biscuits?

16
 Figure 9: Affordability price for customer can bare

Above pie chart shows affordability price consumer can bare for a biscuit. Out of the result
25.7% majority of respondents have affordability to spend 50 rupees for a biscuit. And 22.9%
precent have affordability to spend 100 rupees for a biscuit. That mean majority have low
purchasing power to buy a biscuit. Due to the inflation price of the biscuit goes up and only
14.3% have ability to purchase a biscuit for 200 rupees, 250 rupees or above.
11. Do you know the current inflation rate in Sri Lanka?

Figure 10: Current Inflation Rate

This pie chart shows how many of the people who are living in Sri Lanka, aware on the inflation
which is currently facing. According to the records 82.9% of the respondents are aware about the
situation but there are 17.1% respondents still do not aware on the inflation happening in Sri
Lanka. According to the Colombo Consumer Price Index based Headline inflation rate of the
country is
69.8% on year-on-year basis in September 2022. It was increased from 64.3% in August 2022.

12. What happened to your purchasing power, if inflation rate of the country going to
increase?

17
 Figure 11: Inflation rate impacting for purchasing power

According to the records, there are 91.4% of respondents believe that the purchasing power of
the consumer will go down due to the inflation increases and the smaller number of respondents
of 8.6% still believes that the consumer will be able to purchase the biscuits even though the
inflation rate increase. That mean consumers have general idea about the inflation how impact to
their cost of living. According to that they manage their expenses. 13. What if inflation rate
increased, do you purchase same biscuit for high value?

Figure 12: Purchasing same biscuit for high prices

By looking at the above figure, most of the consumers such as 80%, do not have the intention of
buying biscuits in the period of inflation increases. Still there are 20% of the respondents who
will purchase biscuits for their consumption even though in the inflation period gone up.
Majority of consumers do not have intention to purchase biscuits after inflation increased.
Consuming biscuits is not a necessity good. Therefore, they will not purchase biscuits after the
price increased. In this situation they always try to minimize the cost by balancing their living
18
cost. 14. What if inflation rate increased, will you shift to purchase lower price range
biscuits?

Figure 13: Shifting lower price range biscuits

There are 57.1% of respondents says that they will not purchase any type of biscuits even though
the product price were lower, but there are 42.9% of respondents still buying the biscuits for their
consumption with the lower price as well.

15. What if “YES” the answer please mentioned the examples for the lower price range
biscuits?
 Null
 Small snacks packets
 Mostly will go with same brand and name biscuits, but size if the biscuits will be lesser
than usual cause if price factor.

 Gold Marie
 Onion biscuits by Munchee
 No
 Other product
 Kist
 Butter cookies
 Yes
 Kist cookies

 Marie

19
The results shows that if price increased consumers will switch to lower price ranges biscuits of
small snacks biscuits packets such as Munchee onion biscuits butter cookies and Kist brand
biscuits or some of them will consume small size of the same brand or biscuit products.

16. What if the biscuit company that you are consuming the product will increase the
price, are you still going to consume?

Figure 14:Consuming the price increases biscuits

There are 71.4% of respondents said that they will not consume biscuits if the company increases
the price of the biscuit packet. But there are 28.6% of respondents said “YES” for still buying the
biscuits for their consumption however price gone up.

17. What if the price range of the biscuit will be decrease but the product quality, taste
and other necessary factors will have a low quality, are you still going to consume the
same product?

Figure 15: Consuming biscuits with low quality

20
If the biscuit price goes down, company produce biscuits low quality and taste. Therefore, 91.4%
precent will not buy the biscuits even decrease the price of biscuits. Only 8.6% will buy biscuits
at lower price.

18. If “YES” the answer, please specify your answer “Why”?

3 responses

 Null
 Products have the low price

 Because price of the biscuits is low.

Only 02 respondents answered for this question. They will purchase the biscuits at lower price
even the product quality and taste decreases. This mean even product quality is low consumers
will purchase products at lower price due to the inflation increased. They are not give priority for
product quality. 19. What if your income level is going increase, will you purchase biscuits?

Figure 16: Purchasing level if income level increased

Out of the sample 65.7% precent majority of respondent answered “YES”. If income level
increase, they will purchase biscuits. But 34.3% present said “NO”, these customers will not
purchase biscuits even income goes up.

20. What if your expenses level is going to increase, will you purchase biscuits?

21
 Figure 17: Purchasing biscuits even expenses level increased

Due to the inflation increases, consumers purchasing power going down and cost of living is
high. Therefore, the result shows 77.1% precent will not purchase biscuits due to the expenses
level is high. But as usually 22.9% precent will purchase even expenses level increases.

22
7 Discussion and Conclusion

In conclusion, the study objectives were successfully achieved through the two research
objectives and this research discovered that consumer income and expenses level and how it
affects with inflation and identified the relationship between the current inflation and the
consumer behavior “Experiences of A Biscuit Company in Sri Lanka”.

8 Suggestions

This research was conducted with the general objective of find out the relationship between
current inflation and the consumer behavior “experiences of a biscuit company in Sri Lanka”. To
achieve this general objective there are two specific objectives. Considering the first objective of
identify the income and expenditure levels of consumers. Out of sample of 35 responses, 37.1%
precent consumers are getting more than Rs.55,0000 monthly income and 22.9% precent
monthly expenses are from range of Rs.10,001 to Rs.20,000 and some of them have expenses
level is more than Rs.50,000. Assuming the second objective, this research finds out the how
inflation rate impact to the consumer income and expenditure level. This study identified that
after inflation rate increased the price of the biscuits increased fast. Therefore, consumers made
decisions for stop to purchase biscuits and switch to lower price range biscuits products due to
the cost of living is high and consumers purchasing power go down. Consumers can change what
they should buy to for reduce the costs. The result proved that 25.7% precent of affordability
price consumers can bare for biscuit is 50 rupees. Therefore, consumers switch to lower price
biscuit ranges products and some of them stopped consuming biscuits, because biscuit is not a
necessity good.

Simply price increases and the inflation have the possible to negatively impact to customer
relationships. Consumer should know how to deal with the inflation knowing what should
spending money on and have a long-term investment plan helps to increase the income.
Consumer can find ways to reduce the expenses by looking closer at the bills, cut down what
don’t need and trying to reduce expenses. We can reduce expenses by cutting phone bills, internet
bills, vehicle insurance and home insurance etc. Consumer should not need to pay extra money
for these expenses, they can switch to prepaid service plans, no need Wi-Fi unlimited data and
revisit the insurance coverage and change the insurance coverage. Consumer can reduce the
23
 expenses by always buying essentials products such as food, gas and fuels etc. when it comes to
groceries consumer can save money by being more efficient with what you going to purchase
from market. Consumer can save money reducing the transportation cost also. Another thing is
consumers can take advantages of coupons, cash back credit cards and cashback portals to save
money. For an example customer can purchase products from Daraz biggest 11.11 discount sale
app. Customer can savings money investing on Bonds or open fixed deposit account. Also,
customer can earn extra money from outside of your job, selling products on social media such
as on Ebay, Facebook, Instargram. There have wide variety of side jobs with a flexible schedule
can do from home.

Those are the recommendations for customers to face the inflation efficiently and effectively by
managing the living cost.

9 Problem Statement

Inflation rate changes directly impact to the consumer behavior. Therefore, price of the good and
services are going to change along with the inflation rate. It is impact to the income and the
expenditure levels of the consumer behavior. According to that, consumer suffered from financial
problems due to the inflation increases of the country. This is the problem of the research.

9.1 Knowledge Gap

The relationship between current inflation and the consumer behavior “experiences of a biscuit
company in Sri Lanka” have not been extensively studied in Sri Lanka. Therefore, there is a
knowledge gap in a financially with the consumers.

10 Objectives

10.1 General Objective:

 To find out the relationship between current inflation and the consumer behavior
“experiences of a biscuit company in Sri Lanka” have not been extensively studied in Sri
Lanka.

10.2 Specific Objectives:

24
 • To identify the income and expenditure levels of consumers
• To find out the inflation rate impact to the consumer income and expenditure level

11 Appendices

1. Questionnaire

The Relationship Between Current Inflation and The Consumer Behavior “Experiences of A
Biscuit Company in Sri Lanka”

Thank you for agreeing to take part in this important survey of the research “Relationship
between Current Inflation and the Consumer Behavior “Experiences of a Biscuit Company in Sri
Lanka”. I will be gaining your information in order to better serve you in future and to produce
standard report. This survey would only take 4-5 minutes to complete. Be assured that all
answers you provide will be kept in the strictest confidentially.

1. Gender
• Male
• Female
2. Employee status
• Employed
• Unemployed
3. Monthly Income Level of customer?
• Less than 15000
• 15001-25000
• 25001-35000
• 35001-45000
• 45001-55000
• More than 55000

25
4. What is your expenses level for monthly?
• Less than 10000
• 10001-20000
• 20001-30000
• 30001-40000
• 40001-50000
• Above 50000

5. What would you most have preferred biscuit in Sri Lanka? Reason for that?

…………………………………………………………………………………………..
…………………………………………………………………………………………..

6. What is preferred brand in Sri Lanka?

• Ceylon Biscuit Limited (CBL)
• Maliban Biscuit Manufactories (Pvt) Limited
• Sunrich Confectionery (Private) Limited
• Little Lion
• Luckyland biscuit Manufactures  Cherish Biscuits
• Diana Biscuits  Kist

7. Who is the decision maker for purchasing biscuit in a family?

• Mother
• Father
• Children
• Other

8. Habit of consuming biscuits

• Rarely
• Regularly
• Often

9. What is the factor or factors influencing for buying decision of biscuits?

• Taste
• Packaging
26
 • Price
• Availability
• Company goodwill  Other factors

10. What is the affordability price you can bare for biscuit?
• Rs.50
• Rs.100
• Rs.150
• Rs.200
• Rs.250
• Above Rs.250

11. Do you know the current inflation rate in Sri Lanka?

• YES
• NO

12. What happened to your purchasing power, if inflation rate of the country going to increase?
• Purchasing power going down
• Purchasing power going up

13. What if inflation rate increased, do you purchase same biscuit for high value?

• YES
• NO

14. What if inflation rate increased, will you shift to purchase lower price range biscuits?

• YES
• NO

15. What if “YES” the answer please mentioned the examples for the lower price range biscuits?

………………………………………………..

16. What if the biscuit company that you are consuming the product will increase the
price, are you still going to consume?
• YES
• NO

27
17. What if the price range of the biscuit will be decrease but the product quality, taste
and other necessary factors will have a low quality, are you still going to consume the
same product?
• YES
• NO

18. If “YES” the answer, please specify your answer “Why”?

………………………………………………………………………

19. What if your income level is going increase, will you purchase biscuits?
• YES
• NO

20. What if your expenses level going to increase, will you purchase biscuits?
YES
NO

28
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12 References

• Anon., n.d. https://www.netsuite.com/portal/resource/articles/business-strategy/inflation-effect-

on-business.shtml. Effects of Inflation on Business: The Good and The Bad.
• Anyanwu, J., 1993.
https://www.scirp.org/(S(oyulxb452alnt1aej1nfow45))/journal/home.aspx?journalid=666.
• Olusola, E., Chimezie, E., Shuuya, M. & Addeh, A., n.d. The Impact of Inflation Rate on Private
Consumption Expenditure and Economic Growth—Evidence from Ghana.
https://www.scirp.org/journal/journalarticles.aspx?journalid=2447.
• Orphenides, A. & Solow.M.Robort, 1990. Handbook of Monetory Economics.

13 Research Questions

 How does inflation impact overall consumer spending?

 What specific categories of goods and services are most affected by
changes in inflation?
 How do consumers perceive price changes due to inflation?
 In what ways do inflationary trends influence consumer saving behavior?
 How does inflation affect consumer confidence and their future financial
outlook?
 What coping mechanisms do consumers employ during periods of high
inflation?
 How does inflation impact the purchasing power of different income
groups?
 What role does inflation play in altering consumer brand loyalty?
 How do consumers' credit and borrowing behaviors change in response
to inflation?
 What are the short-term versus long-term consumer behavioral changes
in response to inflation?
 How do inflation expectations influence consumer spending and saving
decisions?
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 In what ways does inflation affect consumer preferences for domestic
versus imported goods?
 How does inflation impact the demand for luxury goods
compared to essential goods?
 What psychological factors drive consumer reactions to
inflation?
 How does inflation influence consumer attitudes towards debt and financial risk?
 What impact does inflation have on consumer investment behaviors?
 How do different demographic groups (age, gender, education level) respond to
inflation?
 What strategies do consumers use to mitigate the effects of inflation on their
household budgets?
 How do inflationary pressures affect consumer perceptions of value and quality?
 In what ways do inflation rates impact consumer spending on discretionary versus
non-discretionary items?
 What role do digital and e-commerce platforms play in consumer behavior during
inflation?
 How does inflation impact consumer trust in financial institutions and government
policies?
 What is the effect of inflation on consumer behavior in emerging versus developed
markets?
 How does inflation influence the frequency and nature of consumer complaints about
prices and services?
 What are the implications of prolonged inflation on consumer lifestyle and wellbeing?

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