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(18729) By Marks buys a one-year German government bond (called a bund) for $400. He receives
principal and interest totaling $436 one year later. During the year the CPI rose from 150 to 162, but he had
thought the CPI would be at 159 by the end of the year. By Marks had expected the real interest rate to be
but it actually turned out to be
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sh the exam.
A. 6%; 3%
B. 8%; 1%
C. 3%; 1%
D. 1%; 3%
