Question: Suppose you had bought a 30-year Treasury bond at a nominal interest rate of 8% and the inflation averages 3% over the next 30 years.

Suppose you had bought a 30-year Treasury bond at a nominal interest rate of 8% and the inflation averages 3% over the next 30 years. Then the real interest rate would turn out to be ___%.

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To calculate the real interest rate we can use the Fisher equation 1 ... View full answer

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