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2 May 2019

During the last year you lent money at a nominal rate of 6 percent.Actual inflation was 1 percent, but people had been expecting 1.5percent . This difference between actual and expectedinflation

A. transferred wealth from the borrower to you and caused youractual real interest rate to be more than 0.5 percentage pointshigher than what you had expected.
B. transferred wealth from you to the borrower and caused youractual real interest rate to be more than 0.5 percentage pointslower than what you had expected.
C. transferred wealth from the borrower to you and caused youractual real interest rate to be 0.5 percentage points higher thanwhat you had expected.
D. transferred wealth from you to the borrower and caused youractual real interest rate to be 0.5 percentage points lower thanwhat you had expected.

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Hubert Koch
Hubert KochLv2
3 May 2019

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