A perpetuity for sale at $100,000 that promises a yearly payment of $5,000 has an effective yield of

A rising inflation rate tends to help the following types of people:

A) retirees and students with savings accounts. B) borrowers and homeowners without mortgages. C) homeowners with mortgages and students with loans. D) landowners and borrowers.

In most cases, expenditure-switching policies must be accompanied by expenditure-reducing policies because

A) expenditure-switching policies are completely ineffective without expenditure-reducing policies. B) inflation ensues as home country domestic expenditures switch away from foreign goods to domestic goods unless overall expenditures are reduced. C) inflation abroad may increase the demand for domestic goods, causing inflation to rise. D) the depreciation in the exchange rate may decrease the domestic price of foreign goods, causing an increase in the current account deficit.