Nominal interest rate and expected inflation, Macroeconomics

Assignment Help:

Q. Nominal interest rate and expected inflation?

When we have inflation, we can't, of course, presume that expected inflation is zero. So real interest rate will no longer be equal to nominal interest rate and we should use R = r + pe. Expected inflation pe is exogenous (even though not essentially constant. In more advanced Keynesian models you would find numerous assumptions on how expectations are formed.


Related Discussions:- Nominal interest rate and expected inflation

Percentage did the price level, By what percentage did the price level, as ...

By what percentage did the price level, as measured by this index, rise between 1984 and 2005?

Explain augmented saving, Augmented Saving An alternative way of determ...

Augmented Saving An alternative way of determining equilibrium  GDP  is to find the level of income where the sum of desired injections equals the sum of desired leakages. Desi

Nations'' levels of per capita, In general, economists have found that as n...

In general, economists have found that as nations' levels of per capita real Gross Domestic Product (GDP) increase, A. the rate of population growth declines. B. the rate of

Indifference curve., what is lemda in marginal utility. And how does it af...

what is lemda in marginal utility. And how does it affect the consumption

Public Sector, What is top marginal rate of taxation?

What is top marginal rate of taxation?

Investment, What are the basic differences between the investment curve and...

What are the basic differences between the investment curve and an investment demand curve for an economy

Credit multiplier, how can the central bank influence the size of the multi...

how can the central bank influence the size of the multiplier

Introducing the foreign trade sector, Introducing the Foreign Trade Sector ...

Introducing the Foreign Trade Sector  Most economies in the real world are open economies. They engage in trade with other economies. Goods and services are exported and import

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd