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Author Question: Julio borrows $250 from Ricky. Ricky wants to make a 5% real return on his money, so they both agree ... (Read 166 times)

ericka1

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on: Apr 19, 2019

Question 1

Drew wants to borrow $500 from Bob. Bob wants to make 4% real return on his money, so they both agree on an 4% interest rate paid next year. Both don't anticipate the -5% inflation next year. In this case


◦ Drew will pay an 4% real interest rate.
◦ Bob is better off.
◦ Drew will pay an 13% nominal interest rate.
◦ All of these.

Question 2

Julio borrows $250 from Ricky. Ricky wants to make a 5% real return on his money, so they both agree on a 5% interest rate paid next year. Both don't anticipate the 5% inflation next year. In this case


◦ Ricky is better off.
◦ Julio will pay $15 a year from now on.
◦ Julio is better off.
◦ Ricky will receive more than 5% of real rate of return a year from now.
Principles of Economics ¦ Case, Fair, Oster ¦ 12th Edition
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Marked as best answer by ericka1 on Apr 19, 2019

cat123

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Reply #1 on: Apr 19, 2019
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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ericka1

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Reply #2 on: Apr 19, 2019
Thank you!


cat123

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Reply #3 on: Apr 19, 2019
Always glad to help...


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