As the inflation rate increases, investors will demand higher nominal rates of return. If the interest rate paid by borrowers and the interest rate received by savers accurately reflect the realised rate of inflation,

a.

both borrowers and savers gain.

b.

neither borrowers nor savers gain nor lose.

c.

both borrowers and savers lose.

d.

savers gain and borrowers lose.

e.

borrowers gain and savers lose.