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:

Deliberating

Engaging in careful consideration or discussion before making a decision.

Generation

A group of individuals born and living about the same time, especially considered as a category of people influenced by the same significant social and cultural events.

Evaluation

The systematic assessment of the value, performance, or significance of an object, project, or policy.

Alternative Course

A different path or method that can be taken to achieve a specific goal or outcome.