Assume the international Fisher effect exists and the inflation rate in the U.S.exceeds the inflation rate in Canada.What can we state for certain given this information?
A) Nominal rates in the United States exceed nominal rates in Canada.
B) Real rates in Canada exceed real rates in the United States.
C) The inflation rate in Canada will increase so it equals the U.S.inflation rate.
D) Nominal rates in Canada exceed nominal rates in the United States.
E) Nominal rates will be the same in both countries.
Correct Answer:
Verified
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