Of the Following, Which Is NOT Relevant to the Calculation

question 43

Multiple Choice

Of the following, which is NOT relevant to the calculation of the return earned on a Treasury bond investment?

• A)The coupons received.
• B)The interest earned on the reinvestment of these coupons.
• C)The price paid for the bond.
• D)The price the bond is sold for, or its face value if held to maturity.
• E)All of these are relevant.

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Definitions:

Nominal GDP

The gross domestic product measured at current market prices, without adjustment for inflation.

GDP Deflator

An index that measures the change in prices of all new, domestically produced, final goods and services in an economy over a period of time.

Inflation Rate

The magnitude of price escalation for goods and services across the board, causing a drop in consumer purchasing prowess.

Inflation Rate

The percentage increase in the general price level of goods and services in an economy over a given period, often measured annually.