The two-year interest rate is 12.6%, and the expected annual inflation rate is 6.3%. a. What is the expected real interest rate? b-1. If the expected rate of inflation suddenly rises to 8.3%, what does Fisher's theory say about how the real interest rate will change? b-2. If the expected rate of inflation suddenly rises to 8.3%, what will be the new nominal rate? Complete this question by entering your answers in the tabs below. Req A Req B1 Nominal rate Req B2 Answer is complete but not entirely correct. If the expected rate of inflation suddenly rises to 8.3%, what will be the new nominal rate? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. 18.81 %

The two-year interest rate is 12.6%, and the expected annual inflation rate is 6.3%. a. What is the expected real interest rate? b-1. If the expected rate of inflation suddenly rises to 8.3%, what does Fisher's theory say about how the real interest rate will change? b-2. If the expected rate of inflation suddenly rises to 8.3%, what will be the new nominal rate? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. If the expected rate of inflation suddenly rises to 8.3%, what will be the new nominal rate? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places