flow-through of inflation (inflation flow-through)

inflation flow-through (flow-through of inflation)

in the absense of full-flow-through of inflation:
inflation of a country where the company operates	low	high
P/E ratio	higher	lower

P/E reflecting the effect of inflation
= 1 / (R_r+((1-IFTR)*i))

R_r: real required rate of return
IFTR: inflation flow-through rate
i: inflation rate