The Fisher equation is:
A) Nominal GDP growth rate = Real GDP growth rate + inflation rate.
B) MV = PY.
C) V = Nominal GDP / M.
D) Real interest rate = Nominal interest rate - inflation rate.

Question

Quizplus · Accepted Answer

The Fisher equation relates the real interest rate to the nominal interest rate and inflation, stating that the real interest rate is equal to the nominal interest rate minus the inflation rate.

The Fisher Equation Is