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Suppose that you borrow $50,000 from the bank to purchase some land and you agree to pay 2 percent interest on the loan. If the
Suppose that you borrow $50,000 from the bank to purchase some land and you agree to pay 2 percent interest on the loan. If the loan must be repaid in 12 months and the inflation rate is 4 percent during the year, then Question 69 options: you will repay the bank with dollars with more purchasing power than you initially borrowed. the bank will receive fewer dollars, because of inflation, than it had initially expected to receive. you will repay the bank with dollars with less purchasing power than it initially loaned you. you will repay the bank with fewer dollars than the bank initially loaned you
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