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(6)(a)Explain the concept of International Fisher Effect (IFE). How is it different from PPP? (b)Assume that the interest rate, on a Certificate of Deposit (CD),
(6)(a)Explain the concept of International Fisher Effect (IFE). How is it different from PPP? (b)Assume that the interest rate, on a Certificate of Deposit (CD), in the U.S. is 11% while the interest rate on a similar asset in UK is 12%. For actual returns on these two rates to be similar from the point of view of the U.S. investor, by how much would the foreign currency have to change over an investment period
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