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    Fundamentals of Corporate Finance Study Set 7
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    Exam 9: Using Discounted Cash-Flow Analysis to Make Investment Decisions
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    What Nominal Annual Return Is Required on an Investment for an Investor
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What Nominal Annual Return Is Required on an Investment for an Investor

Question 58

Question 58

Multiple Choice

What nominal annual return is required on an investment for an investor to experience a 12% gain in purchasing power? Assume inflation is 4%.


A) 7.69%
B) 9.29%
C) 12.00%
D) 16.48%

Correct Answer:

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