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A person who borrows money for 30 years at a fixed rate in order to buy a home is the best example. Inflation has the effect of making the value of the equal monthly mortgage payments smaller. At the same time inflation causes the value of the home to increase. Consider, for instance, someone who borrowed money 25 years ago to buy a home in which they are still living. The monthly payments will seem very small indeed compared to the value of the home.
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Who is helped by inflation?
Debtors, borrowers of the expense of the lender, pornographers.Government officials, COLA union members, speculators, foreign business members, and borrowers all benefit from inflation.Sourcehttp://shsapeconomics.blogspot.com/2007/11/is-inflation-always-bad-thing.html
How will inflation affect hospitality industry in Nigeria?
how does inflation affect hospitality in nigeria industry
Why do borrowers gain during inflation?
because their purchasing power of money is less in real terms they payback less
How do interest rates and inflation affect real estate in south Africa?
explain how do intrest rates and inflation affect the real estate
Discuss how a rapid rate of inflation might affect different groups within an economy?
Rapid inflation will harm all groups through reducing real values, creating uncertainty, instability and harming the efficient operation of the market system. The level of inflation will influence the severity of any effects. Those who benefit include the government, borrowers, importers and some producers. Those who suffer include fixed income earners, lenders, exporters and some producers.
Who is helped by inflation?
Debtors, borrowers of the expense of the lender, pornographers.Government officials, COLA union members, speculators, foreign business members, and borrowers all benefit from inflation.Sourcehttp://shsapeconomics.blogspot.com/2007/11/is-inflation-always-bad-thing.html
How will weather affect the inflation of giant balloons?
how will the weather affect the inflation of the ballooons
How will inflation affect hospitality industry in Nigeria?
how does inflation affect hospitality in nigeria industry
Why do borrowers gain during inflation?
because their purchasing power of money is less in real terms they payback less
Does inflation favor lenders or borrowers?
Inflation generally favors those with debt, because the higher prices will drive wages higher and enable a fixed debt to be more quickly paid off.This is also especially apparent where borrowers can borrow against a higher value of property (e.g. homes) and realize income from the inflated assessment.Inflation harms lenders and savers because loans and savings do not directly appreciate from inflation.
How do interest rates and inflation affect real estate in south Africa?
explain how do intrest rates and inflation affect the real estate
How will the weather affect the inflating of the balloons?
how will the weather affect the inflation of the ballooons
Was the ATM the answer to inflation?
No. The ATM does not in any way affect or answer inflation. It is just a machine through with customers can do banking transactions without visiting their bank. It does not cause or affect inflation. Only the country's central bank can control inflation by changing regulatory policies.
Discuss how a rapid rate of inflation might affect different groups within an economy?
Rapid inflation will harm all groups through reducing real values, creating uncertainty, instability and harming the efficient operation of the market system. The level of inflation will influence the severity of any effects. Those who benefit include the government, borrowers, importers and some producers. Those who suffer include fixed income earners, lenders, exporters and some producers.
What is the ratio of interest on loan from banks?
It depends, among other factors, onthe country and expectations about inflation,the degree of competition between banks,the borrowers' creditworthiness.
How do chemicals affect the inflation of a balloon?
Inflation of a balloon is NOT a chemical reaction, so there are no chemicals involved in 'affecting' it.
How does increased stock prices affect the nation?
Inflation!
