If a country experienced deflation, then

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Deflation is a decrease in the general price level of goods and services, which implies an increase in the purchasing power of money. In this scenario, lenders benefit because the real value of the money loaned increases. As a result, borrowers demand lower nominal interest rates to compensate for the expected deflation. Therefore, the real interest rate, which is adjusted for inflation, is greater than the nominal interest rate, which is not.

If a Country Experienced Deflation, Then