Suppose that at the beginning of a loan contract, the real interest rate is 4% and expected inflation is currently 6%. if actual inflation turns out to be 7% over the loan contract period, then
a)borrowers gain 1% of the loan value.
b)lenders gain 1% of the loan value.
c)borrowers lose 3% of the loan value.
d)lenders gain 3% of the loan value.