Which one of the following would benefit financially from unanticipated inflation?
A) a borrower whose loan has a fixed nominal interest rate
B) a borrower with an adjustable rate mortgage
C) a bank that has made loans at a fixed nominal interest rate
D) a firm whose workers are covered by a COLA agreement
Correct Answer:
Verified
Q352: If a bank advertises 3 percent interest
Q353: Suppose the rate of inflation unexpectedly decreases
Q354: How much should a bank charge for
Q355: Empirical evidence shows that the nominal interest
Q356: The real interest rate is
A) the nominal
Q358: If the nominal interest rate is 4
Q359: During an unanticipated inflation
A) creditors are helped
Q360: If you anticipate that the inflation rate
Q361: Contractions are characterized by
A) increases in the
Q362: During a recession
A) incomes rise and employment
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