If money were free from all controls when transferred internationally,the real rate of interest would ________.
A) be the same in all countries
B) be the same as the inflation rate
C) create arbitrage opportunities across countries
D) create arbitrage opportunities in developed countries

Question

Quizplus · Accepted Answer

If money could be freely transferred internationally without any controls, arbitrage opportunities would ensure that the real rate of interest would equalize across countries, as investors would move funds to take advantage of higher real rates until the rates converge.

If Money Were Free from All Controls When Transferred Internationally,the