Assume the nominal rate of return is 5.31% and the real rate is 3.36%. Find the inflation rate of return using the exact formula.
The Fisher equation, which shows the exact relationship between nominal interest rates, real interest rates, and inflation is:
(1 + R) = (1 + r)(1 + h)
h = [(1 + .0531) / (1 + .0336)] – 1 = 0.0189 or 1.89%
Assume the nominal rate of return is 5.31% and the real rate is 3.36%. Find the...
Assume the nominal rate of return is 8.63% and the real rate is 4.68%. Find the inflation rate of return using the exact formula. Answer Format: Percentage Round to: 0 decimal places (Example: 9%, % sign required. Will accept decimal format rounded to 2 decimal places (ex: 0.09))
Assume the nominal rate of return is 9.78% and the inflation rate is 2.82%. Find the real rate of return using the exact formula.
Assume the nominal rate of return is 5.08% and the inflation rate is 6.10%. Find the real rate of return using the exact formula. Answer Format: Percentage Round to: 0 decimal places (Example: 9%, % sign required. Will accept decimal format rounded to 2 decimal places (ex: 0.09))
Assume the real rate of return is 1.06% and the inflation rate is 3.29%. Find the nominal rate of return using the exact formula. Answer Format: Percentage Round to: -2 decimal places (Example: 0%, % sign required. Will accept decimal format rounded to 0 decimal places (ex: 0))
Assume the nominal rate of return is 8.59% and the real rate is 2.08%. Find the inflation rate of return using the exact formula. Answer format: Percentage Round to: 0 decimal places (Example: 9%, % sign required. Will accept decimal format rounded to 2 decimal places (ex: 0.09)) Suppose you deposit $1,609.00 into and account 6.00 years from today into an account that earns 9.00%. How much will the account be worth 18.00 years from today? Answer format: Currency: Round...
Nominal rate of return on a bond for a year is 7.28 percent and inflation during the year was 3.09 percent. What is the real rate of return on the bond for the year using the exact relation between nominal rates, real rates and inflation?
26. Assume that US, and British investors require a real return of 2%. If the nominal U.S. interest rate is 15%, and the nominal British rate is 13%, then according to the IFE, the British inflation rate is expected to be about what percentage points below the U.S. inflation rate, and the British pound is expected to appreciate by what percentage?
If your nominal rate of return is 9 percent and your real rate of return is 5 percent, what is the inflation rate?
13) The nominal required return on XYZ stock is 14%. The nominal risk-free rate of return is 4% and the real risk-free rate of return is 2%. How much are investors requiring as compensation for risk? What is the inflation premium?
If the current inflation rate is 2.2% and you are earning a real rate of return on investment of 3.8%, then the nominal rate on this investment is closest to (please use the formula; NOT the approximation): 6.8% 6.08% 6.2% 6.0%