Do you think a country with high levels of inflation can be a less attractive investment opportunity? Give reasons to support your answer.

Answers will vary. Inflation can have significant impacts on international business. A country with high levels of inflation can be a less attractive investment opportunity because it is difficult to preserve the value of earnings and to engage in most aspects of business. During periods of high inflation, for instance, worker's salaries must increase frequently (sometimes daily), the cost of supplies increases rapidly, and the pricing of goods and services produced is difficult. Inflation in the United States in 2011 forced Whirlpool, an American multinational manufacturer and marketer of home appliances, to cut jobs and close plants in order to account for the rising costs of steel. Similarly, the multinational food retailer Kellogg's faced higher grain prices and as a result announced intentions to raise its cereal prices from 3 percent to 4 percent.
In a more extreme example, Brazil has experienced such runaway inflation that one grocery store owner said that during Brazil's periods of high inflation he had to hire someone whose job was to go through the store and constantly relabel the prices. Similarly, in 1983-1985, Bolivia had such high inflation that the price of a movie ticket would have increased as you stood in line to buy it. At that point, companies did not list prices because they were changing too frequently. Of course, this damages international businesses, as they must constantly try to adjust not only prices but also employee pay.
The section "The Gini Coefficient" on page 86 discusses significant impacts of inflation on international business. Students can use this section to make their own interpretation and answer this question.