Four Homework ... Saved Help Save & Exit Submit Check my work Suppose two parties agree that the expected Inflation rate for the next year is 1 percent. Based on this, they enter into a loan agreement where the nominal interest rate to be charged is 7 percent. If inflation for the year turns out to be 3 percent, who gains and who loses? Instructions: Enter your responses as whole numbers. The ex ante real interest rate is percent. This is what borrowers think they are paying and lenders think they are earning. With the actual inflation of 3 percent, the ex post real interest rate will be percent This benefits borrowers because they are paying less in real terms than anticipated, while lenders lose when inflation is lower than expected, since they are earning a lower real interest rate than anticipated, nces