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Glossary Term: INFLATION RISK

Definition(s) for INFLATION RISK:


1. ) Also called purchasing power risk, the risk that changes in the real return the investor will realize after adjusting for inflation will be negative. The fact that future inflation rates are not known. It is a possible contributing factor to the makeup of the term structure of interest rates. Inflexible expenses Expenses that cannot be adjusted or eliminated such as car payments or rental payments. Antithesis of flexible expenses.



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