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Question
Observe the relationship of the first pair of words and complete the second pair.
During inflation the debtors gain.
During inflation the ______ lose.
Options
producers
creditors
businessmen
investors in equalities
Solution
During inflation the debtors gain.
During inflation the creditors lose.
Explanation:
During inflation, debtors benefit because they repay their debts with less valuable money than when they borrowed it. On the other hand, creditors suffer losses during inflation since the money they receive back has less purchase value than when they first lent it.
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