You earned a rate of return of 5.7% on your real estate Investments. You determined that...

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Answer 1

Answer #1

Real rate of return = ((1 + Nominal rate of return) / (1 + inflation rate)) - 1

= ((1 + 0.057) / (1 + 0.012)) - 1

= 1.0445 - 1

= 0.0445 or 4.45%

Real rate of return = 4.45%

Answer 2

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