What Is the Real Rate of Return If the Risk-Free

question 24

Multiple Choice

What is the real rate of return if the risk-free rate is 4% and the expected rate of inflation is 2.5%?

• A) 0.43%
• B) 1.50%
• C) 6.35%
• D) 1.46%

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Definitions:

Credibility

The quality of being trusted, believed, or convincing; crucial for effective communication and persuasion.

Main Idea

The main idea refers to the primary or central concept, point, or message that an author or speaker is trying to communicate to the audience.

Indirect Approach

A method of communication where the main point or request is not presented at the beginning but rather after an explanation or background information.

Direct Approach

A communication strategy that involves presenting the main point or conclusion at the beginning, followed by supporting details.