If the nominal interest rate is the government bond rate, and the current change in consumer prices is used as expected inflation, calculate the implied “real” rates of interest by currency.

a. Australian dollar “real” rate

b. Japanese yen “real” rate

c. U.S. dollar “real” rate

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Gross Domestic Product Industrial Unemployment Production Rate Forecast Forecast Country Latest Qtr Qtr* 2007e 2008e Recent Qtr Latest Australia 4.3% 3.8% 4.1% 3.5% 4.6% 4.2% Japan 1.6% -1.2% 2.0% 1.9% 4.3% 3.8% United States 1.9% 3.8% 2.0% 2.2% 1.9% 4.7% Consumer Prices Interest Rates Forecast 3-month 1-yr Govt Country Year Ago Latest 2007e Latest Latest Australia 4.0% 2.1% 2.4% 6.90% 6.23% Japan 0.9% -0.2% 0.0% 0.73% 1.65% United States 2.1% 2.8% 2.8% 4.72% 4.54% Trade Balance Current Account Current Units (per US$) Country Last 12 mos (billion $) Last 12 mos Forecast 07 (billion $) (% of GDP) Oct 17th Year Ago Australia -13.0 -$47.0 -5.7% 1.12 1.33 Japan 98.1 $197.5 4.6% 117 119 United States -810.7 -$793.2 -5.6% 1.00 1.00