Which one of the following is the correct expression for the Fisher equation, where
n = the annual nominal interest rate
r = the annual real interest rate
P = the expected annual inflation rate
| A. | (1 + n) = (1 + r) (1 + P) |
| B. | (1 + r) = (1 + P) (1 + n) |
| C. | (1 + P) = (1 + n)(1 + r) |
| D. | (1 - r)2 = (1 + P)(1 + n) |
Answer : A Explanation : |
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