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investors expect a 0.06 rate of domestic inflation over one year, and a .

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According to the International Fisher effect, if U.S. investors expect a 0.06 rate of domestic inflation over one year, and a .03 rate of inflation in European countries that use the euro, and require a 0.01 real return on invest­ments over one year, the nominal interest rate on one‑year U.S. Treasury securities would be:

Answer = 0.07

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The nominal interest rate on... View the full answer

1 comment
  • I posted a few question to be checked that haven't been answered yet do you mind taking a look at them
    • BahamaBrown
    • Aug 10, 2018 at 9:48pm

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