In recent years, economists have argued about the true value of the real interest rate at any one time and over time. Given that Nominal interest rate = Real interest rate + Expected inflation rate, it follows that Real interest rate = Nominal interest rate − Expected inflation rate. Why do you think that there is so much disagreement over the true value of the real interest rate?
Macroeconomics
Macroeconomics
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In recent years, economists have argued about the true value of the real interest rate at any one time and over time. Given that Nominal interest rate = Real interest rate + Expected inflation rate, it follows that Real interest rate = Nominal interest rate − Expected inflation rate. Why do you think that there is so much disagreement over the true value of the real interest rate?
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