Multiple Choice
What nominal annual return is required on an investment in order that an investor experiences a 12 percent gain in purchasing power? Assume inflation to be 4 percent.
A) 7.69 percent
B) 9.29 percent
C) 12.00 percent
D) 16.48 percent (1 + real rate) x (1 + inflation rate) = 1 + nominal rate
Correct Answer:
Verified
Correct Answer:
Verified
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