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This morning, you observe in the markets that the nominal interest rate is 6%, which includes inflation expectations of 4%. If inflation expectations go up
This morning, you observe in the markets that the nominal interest rate is 6%, which includes inflation expectations of 4%. If inflation expectations go up by 1% and nominal interest rates go up by 1.5%, what is the resulting real interest rate?
-The answer isn't 2.05 or 2.38
This morning, you observe in the markets that the nominal interest rate is 6%, which includes inflation expectations of 4%. If inflation expectations go up by 1% and nominal interest rates go up by 1.5%, what is the resulting real interest rateStep by Step Solution
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