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Suppose people expect inflation to equal 3 percent but in fact, prices have risen by 5%. Describe how this unexpectedly high inflation would help or hurt these individuals?
a. The US government
b. A homeowner with a fixed-rate mortgage
c. Union Worker in the second year of a fixed raise labor contract.
d. A college that has invested some of it endowment in government bonds.
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Suppose people expect inflation to equal 3 percent but in fact, prices have risen by 5%. Describe ho...
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