Consider the Economy Represented in Figure 7

question 116

Multiple Choice

Consider the economy represented in Figure 7.4.If actual inflation was greater than anticipated inflation,

• A)Borrowers would experience a decrease in real income.
• B)Lenders would experience a decrease in real income.
• C)Lenders would experience an increase in real income.
• D)The Federal Reserve would be forced to step in to increase lending.

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Definitions:

Grams

A unit of mass in the metric system, equal to one thousandth of a kilogram.

HI

The chemical formula for hydrogen iodide, a diatomic molecule.

KOH

Potassium Hydroxide, a strong alkali used in various chemical processes and as a cleaning agent.