Assume You Borrow $1, 000 on Credit Cards at an Annual

question 112

Multiple Choice

Assume you borrow $1, 000 on credit cards at an annual interest rate of 10 percent.If the inflation rate is 12 percent during the year and the debt has to be paid back in 12 months, then:

• A)income will be redistributed from you to the bank.
• B)the real return for the bank will be greater than initially expected.
• C)you will repay the bank with fewer dollars than you borrowed.
• D)the dollars repaid will have less purchasing power than those borrowed.
• E)the bank will obtain the same return on the loan as initially expected.

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Definitions:

Double-Barreled

A characteristic of questions or issues that involve multiple aspects, which can confuse the responder or complicate the response.

Simplistic

Describes something that is overly simplified, lacking in complexity or nuance.

Loaded

Often relates to questions or statements designed to elicit emotional responses or contain an implicit assumption.

Yea-Saying

The tendency of respondents to agree with statements or questions regardless of their actual opinion, often leading to bias in survey responses.