An Investor Earned a 5% Nominal Rate of Return Over

question 36

True/False

An investor earned a 5% nominal rate of return over the year. However, over the year, prices increased by 2%. The investor's real rate of return was less than his nominal rate of return.

---

Definitions:

Authority

The power or right to give orders, make decisions, and enforce obedience, often backed by laws or by the consensus of a group.

Relevant Information

Data or facts that are directly related and significant to the matter at hand.

Encouraging Participation

The act of motivating or urging individuals to take part or become actively involved in a process or activity.

Proposed Change

A suggestion or plan put forward to modify, alter, or transform an existing situation, system, or process.