Explain How Inflation Can Affect Asda

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Economic
Interest rates
The interest rates will affect Asda as any money that they will have borrowed they will have to pay back more than the original loan, also the loan they have will they will also have to pay more as the interest rates have gone up from 0.25 to 0.5. This will affect them as it will mean that they will be making less profit as they are having to pay more back to pay off their loan.
The interest rates will affect Asda customers as if they have a loan then they will have to pay more money back with the interest rates going up meaning they will have less money to spend with. This means they will not be able to buy things meaning Asda have less money. The interest rates will also affect Asda customers as if they have money being saved in a bank account they will be able to spend more money as they have more money being saved which will mean more money for Asda.
Inflation …show more content…
It will affect them positively if inflation is rising as they will be able to charge more for their products forcing people to buy their products for a higher price resulting in a higher profit for Asda. Inflation will affect Asda negatively as if inflation falls then they will have to lower the price of their products meaning they will lose money. This will also affect the customers in a similar way but if inflation increases customer will be affected negatively as prices for things will be higher meaning they have to pay more for the same products. They will be affected positively by inflation decreasing as prices will fall meaning they can spend less money on the products they normally buy leaving them with more disposable income to spend on other

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