How Much Would an Investor Need to Receive in Nominal

question 61

Multiple Choice

How much would an investor need to receive in nominal return if he desires a real return of 4% and the rate of inflation is 5%?

• A) 4.20%
• B) 8.64%
• C) 9.00%
• D)9.20%

---

Definitions:

Service Revenues

Income earned from providing services as opposed to selling physical goods.

Dividends

Payments made by a corporation to its shareholder members, distributing earnings.

Common Shares

Shares in a company that signify ownership, allowing those who hold them to participate in voting and receive a part of the profits.

Financial Position

A snapshot of the resources, obligations, and ownership equity of an entity at a specific point in time.