If a lender expects inflation to be 5 percent, and after a loan is made, actual inflation is 10 percent, which of the following will be true?
a. The lender will receive a lower real interest rate than he expected.
b. The loan will be repaid with dollars that are worth more than the lender expected.
c. The nominal rate of interest can be expected to fall in the future.
d. The lender will gain at the expense of the borrower.
A
You might also like to view...
Countries tend to be classified as more or less developed based on
a. the literacy rate. b. the poverty rate. c. the level of income per capita. d. the types of goods they produce.
The buyer of a futures contract
A) assumes the short position. B) has the obligation to deliver the underlying financial instrument at the specified date. C) has the obligation to receive the underlying financial instrument at the specified future date. D) may, at his or her option, deliver or receive the underlying financial instrument at the specified date.
If Carlos is waiting to be called back to his job from which he has been temporarily laid off, the Bureau of Labor Statistics will classify him as unemployed
Indicate whether the statement is true or false
In the figure above, when the market is unregulated and in equilibrium, marginal social cost ________ marginal benefit, and the quantity of chemical produced is ________
A) exceeds; above the efficient quantity B) exceeds; below the efficient quantity C) is below; above the efficient quantity D) is below; below the efficient quantity E) equals; efficient