An unanticipated increase in the inflation rate will most likely:
A) either increase or decrease the real value of the national debt, depending on the effect of inflation on capital gains and losses.
B) increase the real value of the national debt.
C) transfer real wealth from bondholders to the government.
D) have no effect on the real value of the national debt.
Correct Answer:
Verified
Q60: The cyclical surplus is $450 billion, potential
Q61: If inflation is correctly anticipated, those who
Q62: Holding the nominal deficit, nominal interest rate,
Q63: If the nominal deficit is $300 billion,
Q64: If the U.S. inflation rate increases unexpectedly
Q66: All other things equal, the real surplus:
A)falls
Q67: If the nominal deficit is $100 billion,
Q68: Government debt is defined as:
A)a shortfall of
Q69: The real deficit is the nominal deficit
Q70: Bond holders:
A)lose when actual inflation equals expected
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