Question

If inflation is lower than what was expected,

a. creditors receive a lower real interest rate than they had anticipated.



b. creditors pay a lower real interest rate than they had anticipated.



c. debtors receive a higher real interest rate than they had anticipated.



d. debtors pay a higher real interest rate than they had anticipated.

Answer 1

I believe it’s A. Creditors receive a lower real interest rate than they had anticipated.