The Nominal Interest Rate Minus the Inflation Rate Equals the Real

question 143

True/False

The nominal interest rate minus the inflation rate equals the real interest rate.

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Definitions:

Risk-Free Return

The theoretical return on an investment with zero risk of financial loss, typically associated with government bonds.

Time-Weighted Return

A method to measure the rate of return of an investment portfolio which eliminates the distorting effects of inflows and outflows of money.

Dividend

Dividend represents the distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.

Share

A unit of ownership in a company or financial asset, often traded on a stock exchange.