Which of the Following Is True

question 20

Multiple Choice

Which of the following is true?

• A)High and variable rates of inflation will be easy for decision makers to forecast accurately.
• B)Unanticipated inflation is an increase in the general level of prices that was not expected by most decision makers.
• C)In contrast with unanticipated inflation,anticipated inflation implies that the increase in the general level of prices was expected by borrowers but not lenders.
• D)Inflation will increase the prices of goods and services that households purchase but not the wage rates of workers.

---

Definitions:

Interest

The fee for borrowing funds or the reward for lending them, often stated as a percentage of the initial sum.

Furniture

Movable objects intended to support various human activities such as seating, eating, and sleeping.

Focal Date

A specific date used as a reference point for financial calculations, such as the valuation of an asset or the determination of an interest period.

Loan Date

The date on which a loan agreement is signed and the funds are disbursed to the borrower.