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28-08-2020
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Assume the real rate was 9.5% and the inflation rate was 4%. Using the Fisher Effect, what was the nominal rate?

Respuesta :

ewomazinoade ewomazinoade

30-08-2020

Answer:

13.88%

Explanation:

According to the fisher effect

(1 + nominal rate) = (1 + real rate) x (1+ inflation rate)

= (1.095) x (1.04) = 1.1388

(1 + nominal rate) = 1.1388

Nominal rate = 1.1388 - 1 = 0.1388 = 13.88%

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