The Classic Loser from an Unanticipated Inflation Is

question 40

Multiple Choice

The classic loser from an unanticipated inflation is

• A)the borrower who pays less nominal interest than expected.
• B)the borrower who pays more nominal interest than expected.
• C)the saver who earns less real interest than expected.
• D)the saver who earns more real interest than expected,and so should have saved more.

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Definitions:

C$

Emblem denoting the Canadian Dollar, Canada's official currency.

Euro

The accepted form of money in the eurozone, made up of 19 out of the 27 member states of the European Union.

Exchange Rate

The worth of a single currency when converted into another.

Percentage

A portion of a whole expressed as a number between 0 and 100 rather than as a fraction.