USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 67

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Assume that during the past year the consumer price index increased by 1.5 percent and the securities listed below returned the following nominal rates of return.

-Refer to Exhibit 1.5. If next year the real rates all rise by 10 percent while inflation climbs from 1.5 percent to 2.5 percent, what will be the nominal rate of return on each security?

• A) 1.24% and 1.52%
• B) 1.35% and 3.52%
• C) 3.89% and 6.11%
• D) 3.52% and 3.89%
• E) 1.17% and 6.11%

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Definitions:

No Collar

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The equilibrium between personal life and professional work, where both are given equal priority to improve overall happiness and fulfillment.

Creativity

The ability or power to create, characterized by the use of imagination or original ideas to create something; inventiveness.

Frankfurt School

A social and philosophical movement in Germany in the early 20th century that focused on the role of culture in maintaining societal power structures, marked by a critical theory of society.