In the Case of an Unanticipated Inflation

question 112

Multiple Choice

In the case of an unanticipated inflation:

• A) creditors with an unindexed contract are hurt because they get less than they expected in real terms.
• B) creditors with an indexed contract gain because they get more than they contracted for in nominal terms.
• C) debtors with an unindexed contract do not gain because they pay exactly what they contracted for in nominal terms.
• D) debtors with an indexed contract are hurt because they pay more than they contracted for in nominal terms.

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Definitions:

Demand Characteristic

Features of an experimental setting that lead participants to guess the purpose of the study, potentially influencing their behavior.

Extraneous Variable

Any variable that exists within a study that can potentially affect the results, but is not the focus of the study.

Being Good Citizens

The act of fulfilling one's roles and responsibilities in a manner beneficial to society, showing respect for laws and community values.

Confound

To confuse or mix up, often referring to variables that interfere with the clear interpretation of a study's results.