A Bond Has a Nominal Rate of Return of 5

question 31

Multiple Choice

A bond has a nominal rate of return of 5.87% and the inflation rate is 4.13%. What is the approximate real rate?

• A)1.62%
• B)1.70%
• C)1.74%
• D)1.83%
• E)1.88%

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Definitions:

Middle-Aged

The period of adulthood approximately between the ages of 45 and 65, often considered a time of life characterized by stability, growth, and reflection.

Care

The provision of what is necessary for the health, welfare, maintenance, and protection of someone or something.

Adult Children

Adults who maintain a child-like dependency on their parents or parental figures, often due to emotional or economic reasons.

Aging Parents

The phenomenon of adult children coping with and caring for their elderly parents, including the challenges that arise.