Fisher Equation Application


Inflation
:  If the inflation rate is higher than the nominal interest rate, then the real interest rate is positive
True or False? Chapter 8, pp. 200+  (Of Jones Macro Econ, Crisis Update)


    The Fisher Equation is i=r+(pi)
        this implies that  i-(pi)=r
        thus if (pi)>i, 
        then i-(pi)<0
        and therefore r<0
            False







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