Question
Australian government 1-year bond yield is 2.65%. Assuming a 1% real rate of interest for saving in Australia, what is the expected rate of inflation
Australian government 1-year bond yield is 2.65%. Assuming a 1% real rate of interest for saving in Australia, what is the expected rate of inflation over the next year that is implied by the nominal interest rate (according to the Fisher effect)?
| A. | 2.65% | |
| B. | 1.65% | |
| C. | 1% | |
| D. | 2.55% | |
| E. | more information is needed |
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ISE Foundations Of Financial Management
Authors: Stanley B. Block, Geoffrey A. Hirt, Bartley Danielsen
18th International Edition
1265074658, 9781265074654
