With Unanticipated Inflation

question 49

Multiple Choice

With unanticipated inflation,

• A)creditors are hurt unless they have an indexed contract,because they get less than they expected in real terms.
• B)creditors with indexed contracts gain,because they receive more than they contracted for in nominal terms.
• C)debtors with an unindexed contract lose,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.
• E)debtors with an indexed contract are hurt,because they pay more than they contracted for in real terms.

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Definitions:

Factor Analysis

A statistical method used to identify underlying variables, or factors, that explain the pattern of correlations within a set of observed variables.

Psychological Constructs

Abstract entities used to describe and explain emotions, attitudes, intelligence, and other psychological phenomena.

Dimensions

Various aspects, viewpoints, or elements of a situation or concept.

Operationalized

The process of defining a concept or variable in measurable terms to facilitate its identification and study within research.