Joe lends Mary $1,000 for the year. They agree that Mary will repay the full $1,000 at the end of the year and in addition, they agree that Mary will pay Joe $50 in interest payments. A. What is the nominal interest rate that Mary and Joe have agreed to in this contract? B. If Joe and Mary both anticipate that inflation will be 3% for the year, what real interest rate are each of them trying to achieve in their loan contract? C. Suppose the actual inflation rate for the year is 2%. Who benefits more from this inflation rate, and why do you think they benefit more. Explain. D. Suppose the actual inflation rate for the year is 4%. Who benefits more from this inflation rate, and why do you think they benefit more. Explain E. If the inflation rate equals the nominal rate, how does this affect the outcome of this loan contract? F. If you knew what the actual inflation rate was going to be, and it happened to equal the nominal interest rate, would you be willing to be a lender? Why or why not? Explain. 5% A. B. 3% C. D. E. F