Suppose that people expect inflation to equal 6 percent, but in fact, prices rise by 4 percent. Indicate whether this unexpectedly low inflation rate helps or hurts each of the following groups or individuals.
Helps
Hurts
The government
A homeowner with a fixed-rate mortgage
A union worker in the second year of a labor contract
A college that has invested some of its endowment in government bonds that are not indexed Treasury bonds
True or False: Inflation hurts borrowers and helps lenders because borrowers must pay a higher rate of interest.
A. True
B. False

Which of the following best explains cost-push inflation? a. increasing wages for workers drive up the cost of production, forcing producers to charge more to meet their costs. b. consumers demand goods faster than they can be supplied, increasing competition among buyers. c. rising prices for goods and services reduce spending power and cut into consumer demand. d. wages drop so that workers have to spend a higher percentage of income on the cost of necessities.2b2t

Factors like the unemployment rate, the stock market, global trade, economic policy, and the economic situation of other countries have no influence on the financial status of individuals. true or false

You are working on a bid to build two city parks a year for the next three years. this project requires the purchase of $249,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the three-year project life. ignore bonus depreciation. the equipment can be sold at the end of the project for $115,000. you will also need $18.000 in net working capital for the duration of the project. the fixed costs will be $37000 a year and the variable costs will be $148,000 per park. your required rate of return is 14 percent and your tax rate is 21 percent. what is the minimal amount you should bid per park? (round your answer to the nearest $100) (a) $214,300 (b) $214,100 (c) $212,500 (d) $208,200 (e) $208,400