D Question 13 9 pts A small business owner takes out a $1 million loan from PNC bank at the beginning of the year. He needs to pay back $1.05 million at the end of the year. PNC bank expects to earn a real interest rate of 3% and the small business owner expects to pay a real interest rate of 3% when the loan is first made. Over the course of the year, the overall price level as measured by CPI rises by 2%. In this case, O there is no winner or loser, because actual inflation turns out to be the same as expected inflation. O PNC bank is hurt by the inflation because it receives the money bank with a lower real value due to higher than anticipated inflation. The small business owner benefits because inflation means his cost of borrowing is lower than the real interest rate he was expecting to pay. O PNC bank, the lender, is the winner because it can charge a higher nominal interest rate to make up for inflation after the contract expires