You borrow money at a fixed rate of interest to finance your college education. If the rate

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You borrow money at a fixed rate of interest to finance your college education. If the rate of inflation unexpectedly slows down between the time you take out the loan and the time you begin paying it back, is there a redistribution of income?

Do you gain or lose? What if you already expected the inflation rate to slow at the time you took out the loan? Explain.

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Exploring Macroeconomics

ISBN: 9781111970314

5th Edition

Authors: Robert L. Sexton

Question Posted: Oct 29, 2024 07:01 AM

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You borrow money at a fixed rate of interest to finance your college education. If the rate

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Exploring Macroeconomics

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