A Major Difference Between Real and Nominal Returns Is That

question 42

Multiple Choice

A major difference between real and nominal returns is that:

• A) real returns adjust for inflation, and nominal returns do not.
• B) real returns use actual cash flows, and nominal returns use expected cash flows.
• C) real returns adjust for commissions, and nominal returns do not.
• D) real returns show after-tax returns, and nominal returns show before-tax returns.

---

Definitions:

Personnel Department

The department within an organization that is responsible for hiring, training, and managing employees.

Assembly Department

A division within a manufacturing company where assembled components are put together to form a finished product.

Cost Allocated

The distribution of an indirect cost or group of costs to the various departments, projects, or products that benefit from those costs.

Support Department

An organizational unit that provides essential services, support, or resources that help other direct-function departments operate effectively.