What Is the Risk-Free Rate in an Environment Where the Real

question 3

Multiple Choice

What is the risk-free rate in an environment where the real rate is 3% and inflation is running at 3%? Use either method found in chapter one.

• A)14.5% or just 14%
• B)10.21% or just 10%
• C)6.09% or just 6%
• D)9.09% or just 9%
• E)0%

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