According to the Fisher Effect, If the Real Rate of Interest

question 93

Multiple Choice

According to the Fisher effect, if the real rate of interest in a country is 5 percent and the annual inflation is expected to be 10 percent, the nominal interest rate will be

• A)5 percent.
• B)10 percent.
• C)12.5 percent
• D)15 percent.
• E)20 percent.

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