Way back in 1976, I recall that in the HSC unit 3 economics exam, students (including me) were required to describe the difference between “cost-push” inflation and “demand-pull” inflation. In those days, both the world and Australia were battered by rolling inflation caused by an oil crisis and the geopolitical consequences that flowed from conflict in the Middle East.

Given the current elevated inflation, I suspect that this year’s HSC economics students could be confronted by a similar question. Further, as an extension question, students could be asked to advise on the policies the government’s fiscal policy and the Reserve Bank of Australia’s monetary policy should employ to rein in inflation.