It follows from the Fisher Effect that if the real interest rate is the same worldwide, then any difference in interest rates between countries reflects:

Question

Quizplus · Accepted Answer

The Fisher Effect posits that the difference in nominal interest rates between countries is primarily due to differences in expected inflation rates. This means that if the real interest rate is constant globally, any variation in nominal interest rates would reflect differing inflation expectations.

It Follows from the Fisher Effect That If the Real