A lender need not be penalized by inflation if the:
A. long-term rate of inflation is less than the short-term rate of inflation.
B. short-term rate of inflation is less than the long-term rate of inflation.
C. lender correctly anticipates inflation and increases the nominal interest rate accordingly.
D. inflation is unanticipated by both borrower and lender.
C. lender correctly anticipates inflation and increases the nominal interest rate accordingly.
You might also like to view...
What is the difference between wage differentials caused by differences in human capital and compensating wage differentials?
What will be an ideal response?
Refer to the above table. What is the absolute price elasticity of demand when a price rises from $9 to $9.50?
A) 0.35 B) 0.55 C) 2.57 D) 2.85
The General Agreement on Tariffs and Trade (GATT) was established in
a. 1870 to protect U.S. industries and decrease world trade b. 1921 to manage legal and accounting requirements for U.S. tariffs and quotas c. 1947 to reduce trade restrictions among 23 countries d. 1973 to increase trade restrictions, after OPEC significantly raised oil prices e. 1990 to create a common market
The U.S. Postal Service enjoys a monopoly position because of patent rights
a. True b. False Indicate whether the statement is true or false