The Fisher equation implies ________.
A)the nominal interest rate equals the real rate of inflation plus expected inflation
B)the real interest rate equals expected inflation
C)expected inflation equals current inflation
D)the rate of inflation equals the real minus the nominal rates of interest
E)none of the above

Question

Quizplus · Accepted Answer

The Fisher equation states that the nominal interest rate is equal to the real interest rate plus expected inflation, which is not accurately described by any of the given options.

The Fisher Equation Implies ________