Who gains when there is unexpected deflation?
A) real-asset owners
B) borrowers
C) lenders
D) real-asset owners, borrowers, and lenders

Question

Quizplus · Accepted Answer

Lenders gain when there is unexpected deflation as the value of money increases, making it easier for them to pay off their debts with the same amount of money. Borrowers, on the other hand, suffer as the real value of their debts increases, making it harder for them to pay off their loans. Real-asset owners may or may not be affected depending on the specific type of assets they hold.

Who Gains When There Is Unexpected Deflation