8. 11. The international Fisher effect [LO 21.2] You observe that the inflation rate in Australia is

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8. 11.

The international Fisher effect [LO 21.2] You observe that the inflation rate in Australia is 3.5 per cent per year and that T-notes currently yield 4.1 per cent annually. Using the approximate international Fisher effect, what do you estimate the inflation rate to be in:

1. New Zealand, if short-term New Zealand Government securities yield 4 per cent per year?

2. Canada, if short-term Canadian Government securities yield 7 per cent per year?

3. Taiwan, if short-term Taiwanese Government securities yield 9 per cent per year?

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Fundamentals Of Corporate Finance

ISBN: 9781743768051

8th Edition

Authors: Stephen A. Ross, Rowan Trayler, Charles Koh, Gerhard Hambusch, Kristoffer Glover, Randolph W. Westerfield, Bradford D. Jordan

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