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Yes, inflation and increases in interest rates usually go hand-in-hand, though inflation is not the sole cause of an increase in interest rates
Prices can be accompanies by either inflation, an increase in real wages, or a decrease in consumption.
Exchange rates would most likely stay the same. If inflation increase or decreases I believe that is where exchange rates will more so be affected
The prices of bonds will fall and yields to maturity (or call date) will rise, since investors will require greater yields on their investments to offset the expected increase in inflation.
inflation and deflation
increase inflation
Yes, inflation and increases in interest rates usually go hand-in-hand, though inflation is not the sole cause of an increase in interest rates
Prices can be accompanies by either inflation, an increase in real wages, or a decrease in consumption.
Exchange rates would most likely stay the same. If inflation increase or decreases I believe that is where exchange rates will more so be affected
The prices of bonds will fall and yields to maturity (or call date) will rise, since investors will require greater yields on their investments to offset the expected increase in inflation.
inflation and deflation
The question is incomplete.
which of the following group is most hurt by unexpected inflation
Inflation at its core is a monetary problem. It is simply too much money chasing too few goods. The father of this theory is Milton Friedman (see link below).Rapidly rising production costs
This is chiefly due to the illusion of money. By definition, inflation is an increase in the general price level. And durable consumer goods and goods that consumers are not likely to buy again for an extended period of time. Therefore, sellers believe that they will make more money if they sell the good when the prices are higher as to increase profit although this belief is offset by an increase in prices of all other goods.
Debtors.
Less inflation.