You Want to Earn a Real Rate of Return of 3.25

question 39

Multiple Choice

You want to earn a real rate of return of 3.25 percent at a time when the inflation rate is 2.41 percent. What is the approximate nominal rate which you must earn?

• A) 5.42 percent
• B) 5.66 percent
• C) 5.68 percent
• D) 5.74 percent
• E) 5.81 percent

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Definitions:

Neogene Period

A division of geological time from approximately 23 to 2.6 million years ago, part of the Cenozoic Era.

Chemical Evolution

The process through which simple chemical compounds gradually transformed into more complex molecules, eventually leading to the emergence of life.

Salinity

The concentration of dissolved salts (e.g., sodium chloride) in a body of water.

Ultraviolet Radiation

A form of electromagnetic radiation with a wavelength shorter than that of visible light but longer than X-rays, which can have effects ranging from beneficial, like vitamin D synthesis, to harmful, like skin cancer.