Assume that the international Fisher effect (IFE) holds between the United States and the United Kingdom. The U. S. inflation


Assume that the international Fisher effect (IFE) holds between the United States and the United Kingdom. The U. S. inflation is expected to be 5 percent, while British inflation is expected to be 3 percent. The interest rate offered on pounds is 7 percent, and the U. S. interest rate is 7 percent. What does this say about real interest rates expected by British investors


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