Inflation and the production function

This article stresses the necessity for management action to be continuously adjusted to changing conditions of business. Changes in values caused by inflation have an impact upon every aspect of production and their effect can be appreciated only by the provision of meaningful management information. Traditional practices of management accounting have inculcated attitudes to problems of production management which under conditions of inflation can be seriously mistaken. A wide range of production problems is considered in the light of inflation and the solutions based upon relevant and effective management accounting are indicated.