>Costs can’t increase if wages stay the same. Material costs, property taxes, fuel/electricity costs, insurance, maintenance, etc can increase while wages remain stable. The product cost goes up, by wages don't. In addition, inflation impacting the purchasing power of the dollar drives prices up across the board. All the money spent by Govt beyond taxes collected (deficit spending) increases the dollars in circulation, driving prices up - more money chasing the same number of available product. If the company buys product from other countries the exchange rate can fluctuate driving cost in USD up or down. Wages are generally a response to higher costs and not the driver, though over time a feedback loop can make wages a bigger component of inflation. Artificially increasing minimum wage is not a natural thing and can help to drive price inflation in low wage reliant products - fast food, gas stations, merchandisers, etc. CA's increase from $17.50 to $22.50 is around a 30% increase and would need to be passed onto the customer, thus inflating restaurant pricing. >Product need consumers, you can’t sell gas for $5/gal if the average household is earning $200/year Yes, if the end customer price increases enough, the lower income folks will find alternatives or do without. If the price increases too much, more people find alternatives or do without, the business sells much less product, further driving their prices higher to cover their fixed costs and cutting back on employees. It gets ugly and can become self reinforcing like during the depression.