If us investors expect a 005 rate of domestic inflation


According to the International Fisher effect, if U.S. investors expect a 0.05 rate of domestic inflation over one year, and a .03 rate of inflation in European countries that use the euro, and require a 0.04 real return on invest­ments over one year, the nominal interest rate on one?year U.S. Treasury securities would be:

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Financial Management: If us investors expect a 005 rate of domestic inflation
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