Consider the following five people and businesses:
I. Angela injured herself at work and is no longer working. The government pays her a fixed dollar amount in disability benefits each week.
II. Arti has a just bought a house. She paid for the house by taking out a large mortgage.
III. Farmer’s Bank has given out large loans to dairy farmers.
IV. Christian is saving money to buy a house.
V. Yi is a retired gardener who has a pension that adjust with inflation. For example, her pension rises with inflation and falls with deflation.
Which of the following statements is true?

Question

Consider the following five people and businesses: 
 I. Angela injured herself at work and is no longer working. The government pays her a fixed dollar amount in disability benefits each week. 
 II. Arti has a just bought a house. She paid for the house by taking out a large mortgage. 
 III. Farmer’s Bank has given out large loans to dairy farmers. 
 IV. Christian is saving money to buy a house. 
 V. Yi is a retired gardener who has a pension that adjust with inflation. For example, her pension rises with inflation and falls with deflation.  
 Which of the following statements is true?

Answer

Angela is better off under deflation (where the level of prices is falling).

Answer

Inflation penalizes Christian and Farmer’s Bank.

Answer

Inflation is beneficial for Arti.

Answer

All of the other answers are correct.

Crowdly

Consider the following five people and businesses: I. Angela injured herself a...

Want instant access to all verified answers on moodle.telt.unsw.edu.au?