A firm with heavy long-term debt can benefit during inflationary times,as debt can be repaid with "cheaper" dollars.

Name: A firm with heavy long-term debt can benefit during inflationary times,as debt can be repaid with "cheaper" dollars.
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Question

Quizplus · Accepted Answer

During times of inflation, the value of money decreases, and therefore the dollars needed to repay long-term debt are "cheaper" compared to their initial value. This can benefit firms with heavy long-term debt as they can repay their debt with less valuable dollars.

A Firm with Heavy Long-Term Debt Can Benefit During Inflationary