If the nominal interest rate is 8 percent in germany and 10


The real interest rates and real exchanges rates are constant and equal in Germany and Turkey. The Fisher equation and purchasing power parity hold in both countries. If the nominal interest rate is 8 percent in Germany and 10 percent in Turkey, do you expect Germany's nominal exchange rate to appreciate, depreciate, or remain the same? Explain.

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Business Economics: If the nominal interest rate is 8 percent in germany and 10
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