(02.05 MC) Which of the following is true for an unexpected inflation rate? A: A loan at an interest rate that is index

Business, Finance, Economics, Accounting, Operations Management, Computer Science, Electrical Engineering, Mechanical Engineering, Civil Engineering, Chemical Engineering, Algebra, Precalculus, Statistics and Probabilty, Advanced Math, Physics, Chemistry, Biology, Nursing, Psychology, Certifications, Tests, Prep, and more.
Post Reply
answerhappygod
Site Admin
Posts: 899603
Joined: Mon Aug 02, 2021 8:13 am

(02.05 MC) Which of the following is true for an unexpected inflation rate? A: A loan at an interest rate that is index

Post by answerhappygod »

(02.05 MC)

Which of the following is true for an unexpected inflation
rate?
A: A loan at an interest rate that is indexed to the
inflation rate will be better off in the case of unexpected
inflation.
B: An investor who has just invested in a government bond that
pays him a fixed amount will be better off.
C: Emily borrows the money from a bank at a fixed interest rate
and will be better off because of unexpected inflation.
D: John is receiving $2,000 per month from his internship and is
better off regardless of the inflation rate.
E: Workers working in a firm are better off when they receive a
3% increase in wages if inflation unexpectedly rises by 5%.
Join a community of subject matter experts. Register for FREE to view solutions, replies, and use search function. Request answer by replying!
Post Reply