What Nominal Return Was Received by an Investor When Inflation

question 25

Multiple Choice

What nominal return was received by an investor when inflation averaged 8.0 percent and the real rate of return was a negative 2.5 percent?

• A)5.30 percent
• B)5.36 percent
• C)6.50 percent
• D)10.77 percent

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Definitions:

Population Proportion

The fraction of members in a group that possess a particular characteristic, often expressed as a percentage of the total population.

Confidence Interval

An assortment of values, from sampled evidence, which possibly contains the value of an unknown parameter of the population.

Estimator

An estimator refers to a statistic used to estimate the value of a population parameter based on sample data.

Significance Level

The probability of rejecting the null hypothesis in a statistical test when it is actually true, typically denoted by alpha (α).