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Basic Question 11 of 27
Suppose that the one year interest rate is 4% in Canada (domestic country). The expected Canadian inflation rate is 2% and the expected German inflation rate is 3%. If the international Fisher relation holds, the exact one year interest rate in Germany should be _____, and the approximate amount (by linear approximation) should be ______.
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I used your notes and passed ... highly recommended!
Lauren
Learning Outcome Statements
describe the carry trade and its relation to uncovered interest rate parity and calculate the profit from a carry trade;
CFA® 2026 Level II Curriculum, Volume 1, Module 8.