You observe that the inflation rate in Canada is 2.4% per year and that T-bills currently yield 2.9% annually.

a. What do you estimate the inflation rate to be in Australia, if short-term Australian government securities yield 9% per year? (Round the final answer to 1 decimal place.)

Inflation rate %

b. What do you estimate the inflation rate to be in the United States, if short-term U.S. government securities yield 12% per year? (Round the final answer to 1 decimal place.)

Inflation rate %

c. What do you estimate the inflation rate to be in Taiwan, if short-term Taiwanese government securities yield 14% per year? (Round the final answer to 1 decimal place.)

Inflation rate %

Answer rating: 100% (QA)

a If shortterm Australian government securities yield 9 per year then the infla... View the full answer