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7A. According to the Fisher effect, which of the following factors affect the level of nominal (quoted) interest rates? a. The expected inflation rate b.
7A. According to the Fisher effect, which of the following factors affect the level of nominal (quoted) interest rates? a. The expected inflation rate b. The real interest rate. c. Perceived risk for the country in question d. All of the above are relevant factors. e. Only a and b are relevant factors. 7B. If both purchasing power parity and interest parity hold, which of the following statements are true? a. The nominal exchange rate should equal 1 at all times. b. Real interest rates should be equal across countries. c. Real interest rates should be close to being equal across countries, although differences in country risk and barriers to international capital flows may cause some differences. d. None of the above statements are true
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