When real interest parity holds:
A) nominal interest rates are equal all over the world.
B) real interest rates are equal across nations with different currencies.
C) real interest rates on dollar assets are equal but not for all currencies.
D) real interest rates will follow a pattern of convergence, but equilibrium will never occur.

Question

Quizplus · Accepted Answer

The Answer of When real interest parity holds:
A) nominal interest rates are equal all over the world.
B) real interest rates are equal across nations with different currencies.
C) real interest rates on dollar assets are equal but not for all currencies.
D) real interest rates will follow a pattern of convergence, but equilibrium will never occur.

When Real Interest Parity Holds