Question
In: Economics
How did the real interest rates paid on long-term government debt in Canada and the United...
How did the real interest rates paid on long-term government
debt in Canada and the United States compare with each other over
the period from 1984 to 2015?
Select one:
a. The average real interest rate was 3.4 percent in Canada
and 4.4 percent in the United States.
b. The average real interest rate was 3.7 percent in Canada
and 3.0 percent in the United States.
c. The average real interest rate was 6.7 percent in Canada
and 5.7 percent in the United States.
d. The average real interest rate was 5.7 percent in Canada
and 6.7 percent in the United States.
Solutions
Expert Solution
Long-term interest rates are rates of government bonds maturing in ten years.
The data is
| Location ▾ | ▾ 1984 | ▾ 1985 | ▾ 1986 | ▾ 1987 | ▾ 1988 | ▾ 1989 | ▾ 1990 | ▾ 1991 | ▾ 1992 | ▾ 1993 | ▾ 1994 | ▾ 1995 | ▾ 1996 | ▾ 1997 | ▾ 1998 | ▾ 1999 | ▾ 2000 | ▾ 2001 | ▾ 2002 | ▾ 2003 | ▾ 2004 | ▾ 2005 | ▾ 2006 | ▾ 2007 | ▾ 2008 | ▾ 2009 | ▾ 2010 | ▾ 2011 | ▾ 2012 | ▾ 2013 | ▾ 2014 | ▾ 2015 |
| Canada | 13.24 | 11.44 | 9.64 | 10.04 | 10.34 | 10.34 | 11.24 | 10.04 | 8.64 | 7.84 | 8.84 | 8.74 | 7.74 | 6.64 | 5.84 | 6.04 | 6.44 | 6.04 | 5.84 | 5.34 | 5.14 | 4.64 | 4.74 | 4.84 | 4.14 | 3.74 | 3.74 | 3.34 | 2.44 | 2.84 | 2.74 | 2.04 |
| United States | 12.4 | 10.6 | 7.7 | 8.4 | 8.8 | 8.5 | 8.6 | 7.9 | 7 | 5.9 | 7.1 | 6.6 | 6.4 | 6.4 | 5.3 | 5.6 | 6 | 5 | 4.6 | 4 | 4.3 | 4.3 | 4.8 | 4.6 | 3.7 | 3.3 | 3.2 | 2.8 | 1.8 | 2.4 | 2.5 | 2.1 |
So average of Canada is 6.7 while that of US is 5.7.
The correct option is
c. The average real interest rate was 6.7 percent in Canada and 5.7 percent in the United States.
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Rahul Sunny answered 8 months agoRelated Solutions
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