ECONOMICS
INFLATION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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creditors
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savers
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consumers
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fixed income investors
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debtors
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Detailed explanation-1: -It can benefit both borrowers and lenders depending on the circumstances. Inflation allows borrowers to pay lenders back with money that is worth less than it was when it was originally borrowed, which benefits borrowers. When inflation causes higher prices, the demand for credit increases, which benefits lenders.
Detailed explanation-2: -People who have to repay their large debts will benefit from inflation. People who have fixed wages and have cash savings will be hurt from inflation. Inflation is a situation where the money will be able to buy fewer goods than it was able to do so as the value of money comes down.
Detailed explanation-3: -Therefore, Debtors are the most benefitted from inflation.
Detailed explanation-4: -The most adversely affected groups by inflation is usually the wage earners in the informal sector with a specific wage rate and pensioners with fixed pensions as their income remains the same but due to increase in the general price level their expenditure rises.
Detailed explanation-5: -Collectors. Borrowers With Existing Fixed-Rate Loans. The Energy Sector. The Food and Agriculture Industry. Commodities Investors. Banks and Mortgage Lenders. Landowners and Real Estate Investors. 01-Mar-2023