ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Pedro, who receives income from his stock portfolio.
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Marie, who loaned money at a fixed rate.
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Jim, who works at a company that gives raises every year.
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Sally, who has a fixed payment on a mortgage.
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Detailed explanation-1: -Lenders are hurt by unanticipated inflation because the money they get paid back has less purchasing power than the money they loaned out. Borrowers benefit from unanticipated inflation because the money they pay back is worth less than the money they borrowed.
Detailed explanation-2: -Families have grappled with surging prices over the past 18 months, as the cost of meeting basic needs rose. Consumer prices were 7.1 percent higher in November 2022 than a year earlier.
Detailed explanation-3: -Debtors and Creditors: During periods of rising prices, creditors gain and debtors lose. Equity Holders or Investors: Persons who hold shares or stocks of companies gain during inflation. Salaried Persons: Salaried workers such as clerks, teachers, and other white collar persons lose when there is inflation.