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You observe that the current interest rate on short-term U.S. Treasury bills is 4.58 percent. You also read in the newspaper that the GDP deflator,
You observe that the current interest rate on short-term U.S. Treasury bills is 4.58 percent. You also read in the newspaper that the GDP deflator, which is a common macroeconomic indicator used by market analysts to gauge the inflation rate, currently implies that inflation is 1.45 percent. What is the approximate real rate of interest on short-term Treasury bills?
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