Which of the Following Is True About Typical Real Estate

question 9

Multiple Choice

Which of the following is true about typical real estate investment (unlevered, at the direct property level) and inflation risk?

• A) Real estate investment appreciation returns do not generally keep pace with inflation in the long run, but real estate investment provides a hedge against inflation risk in that unexpected changes in inflation tend to be positively correlated with changes in property value in the short to medium term.
• B) Real estate investment appreciation returns generally at least equal the inflation rate in the long run, but real estate does not provide a good hedge against inflation risk in that unexpected changes in inflation do not tend to be positively correlated with changes in property value in the short to medium term.
• C) Real estate investment appreciation returns generally at least equal the inflation rate in the long run, and real estate investment provides a hedge against inflation risk in that unexpected changes in inflation tend to be positively correlated with changes in property value in the short to medium term.
• D) Real estate investment appreciation returns do not generally keep pace with inflation in the long run, and real estate does not provide a good hedge against inflation risk in that unexpected changes in inflation do not tend to be positively correlated with changes in property value in the short to medium term.

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Definitions:

Organizational Decision Making

The process by which choices are made within an organization, typically involving several departments or stakeholders.

Standing Committees

Permanent committees established to perform a continuing function and exist for the lifespan of the organizing body to which they belong.

Clinical Staff

Healthcare professionals engaged in the care of patients, including doctors, nurses, and therapists.

Capacity Building

The process of developing and strengthening the skills, abilities, processes, and resources that organizations and communities need to survive, adapt, and thrive.