The data below show the nominal interest rate and the inflation rate for several developed economies as reported in The Economist in February 201 5 a Compute the real interest rate for each country, assuming that people expected the inflation rate at the time to persist b If you were a lender, in w...

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The data below show the nominal interest rate and the inflation rate for several developed economies as

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The data below show the nominal interest rate and the inflation rate for several developed economies as reported in The Economist in February 201 5.

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a. Compute the real interest rate for each country, assuming that people expected the inflation rate at the time to persist.

b. If you were a lender, in which country would you have wanted to lend in February 201 5? Explain.

c. If you were a borrower, in which country would you have wanted to borrow in February 201 5? Explain.

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Macroeconomics

ISBN: 9780133910445

15th Edition

Authors: Christopher T S Ragan

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Question Posted: Mar 14, 2024 12:01 PM

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The data below show the nominal interest rate and the inflation rate for several developed economies as

Question:

Nominal Interest Rate (on 10-year Inflation Rate (% change in Real government CPI from Interest Country bonds) previous year) Rate Australia 2.60 1.7 Canada 1.47 1.5 Euro area. 0.38 -0.6 Japan 0.39 2.4 Switzerland 0.05 -0.5 U.K. 1.75 0.3 U.S.A. 2.10 0.8

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