All of the following are factors that affect nominal interest rates EXCEPT

Question

Quizplus · Accepted Answer

Foreign exchange rates are not a direct factor affecting nominal interest rates. Nominal interest rates are primarily influenced by the real interest rate (reflecting the real return on investment), time to maturity (affecting the yield based on the investment period), and specific features of a financial instrument such as convertibility options. Foreign exchange rates influence international investment and borrowing decisions but do not directly determine the nominal interest rate of a financial instrument.

All of the Following Are Factors That Affect Nominal Interest