Use the Information Below for the Following Problem(S)

question 67

Multiple Choice

Use the Information Below for the Following Problem(S)
Consider the following information
Nominal annual return on U.S. government T-bills for year 2009 = 3.5%
Nominal annual return on U.S. government long-term bonds for year 2009 = 4.75%
Nominal annual return on U.S. large-cap stocks for year 2009= 8.75%
Consumer price index January 1, 2009 = 165
Consumer price index December 31, 2009 = 169
-Refer to Exhibit 1.7.Calculate the annual real rate of return for U.S.T-bills.

• A) 2.26%
• B) 1.81%
• C) -0.5%
• D) 1.05%
• E) None of the above

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Definitions:

Valley Glacier

A glacier that flows down a valley and tends to be narrow; synonym: alpine glacier.

Ribbon Glacier

A type of long, narrow glacier, usually formed in mountain terrains, resembling a ribbon in aerial views.

Elevation

The height of a point or object measured from a specific level, typically sea level.

Tarn

A small lake, especially one within a cirque, a glacially scoured depression.