If the real rate of interest is the same internationally, then the nominal interest rates differ solely by the expected inflation differential in two countries

Indicate whether the statement is true or false


TRUE
Explanation:
id = rd + ?d and iF = rF + ?F
then id - iF = rd + ?d - rF - ?F
= ?d - ?F since rd and rF are equal

Economics

You might also like to view...

The figure above shows the market for annual influenza immunizations the United States

If the government intervenes in the market and provides a subsidy to providers of immunizations to immunize the efficient number of people, the amount of the subsidy is ________ per person. A) $25 B) $50 C) $35 D) $15 E) $40

Economics

For every dollar's worth of government securities the Fed sells, the money supply

A) rises by more than $1. B) rises by less than $1. C) falls by less than $1. D) falls by more than $1.

Economics

The largest budgetary expense for a typical state or local government is

a. education. b. Medicare. c. highways. d. income security.

Economics

The largest component of M1 is

A. transaction deposits. B. traveler's checks. C. currency and coins. D. time deposit.

Economics