Suppose the inflation rate is higher than expected.Which one of the following groups would be most likely to gain?
A) borrowers
B) lenders
C) persons on fixed incomes
D) workers under contract without a cost-of-living adjustment

Question

Suppose the inflation rate is higher than expected.Which one of the following groups would be most likely to gain?  
A) borrowers 
B) lenders 
C) persons on fixed incomes 
D) workers under contract without a cost-of-living adjustment

Quizplus · Accepted Answer

Borrowers would benefit from inflation because they will repay their loans with dollars that are worth less than when they borrowed the money.

Suppose the Inflation Rate Is Higher Than Expected