Given a home country and a foreign country, the international Fisher effect (IFE) suggests that:
A. the nominal interest rates of both countries are the same.
B. the inflation rates of both countries are the same.
C. the exchange rates of both countries will move in a similar direction against other currencies.
D. none of these.
Answer:D
Given a home country and a foreign country, the international Fisher effect (IFE) suggests that:
A. the nominal interest rates of both countries are the same. B. the inflation rates of both countries are the same. C. the exchange rates of both countries will move in a similar direction against other currencies. D. none of these.