Why Are Creditors Harmed by Unexpected Inflation

Multiple Choice

Why are creditors harmed by unexpected inflation?

A) ​Creditors receive lower nominal rates of interest when prices rise.
B) ​Creditors are paid back with more valuable dollars.
C) ​Creditors receive higher nominal rates of interest when prices rise.
D) ​Creditors are paid back money with less spending power than they expected when the money was loaned out.