Question
In: Finance
True or False Returns adjusted for the effects of inflation are known as nominal returns. ANSWER:...
True or False
Returns adjusted for the effects of inflation are known as nominal returns.
ANSWER: ________
Your real return on an investment is the percentage change in the number of dollars you have.
ANSWER: ________
Solutions
Expert Solution
Nominal return = real return + inflation
1) False, return adjusted for inflation is real return. Real return = Nominal return - inflation
2) False, absolute change in number of $ is nominal return not real return.
jeff jeffy answered 2 years agoRelated Solutions
51. The relationship between nominal returns, real returns, and inflation is referred to as the: A....
51. The relationship between nominal returns, real returns, and
inflation is referred to as the:
A. call premium.
B. Fisher effect.
C. conversion ratio.
D. spread.
E. current yield.
52. Which of the following bonds would have the greatest percentage
decrease in value if all interest rates in the
economy rise by 1%?
A. 10-year, zero coupon bond;
B. 30-year, zero coupon bond;
C. 20-year, 10% coupon bond;
D. 10-year, 10% coupon bond;
E. 20-year, 5% coupon bond;
53. If...
. ________ tells us the relationship between nominal returns, real returns and inflation. A. the Fisher...
. ________ tells us the relationship between nominal returns,
real returns and inflation.
A. the Fisher Effect
B. Efficient Market Hypothesis
C. Fisher's separation theorem
D. both the Fisher Effect and Fisher's separation theorem
ANSWER TRUE OR FALSE 1) An independent central bank always gets to choose the country's inflation...
ANSWER TRUE OR FALSE
1) An independent central bank always gets to choose the
country's inflation rate.
2) The issue of time inconsistency can be resolved through the
use of constrained discretion
3) Governments would be wise to announce a no-negotiation policy
with hostage-takers.
4) The Reserve Bank would be wise to fine tune its monetary
policy actions so has to always hit its 2 percent inflation
target.
5) When playing policy games, it is sometimes better for a
policymaker...
The following table shows the nominal returns on Brazilian stocks and the rate of inflation. Year...
The following table shows the nominal returns on Brazilian
stocks and the rate of inflation.
Year
Nominal Return (%)
Inflation (%)
2012
0.4
7.4
2013
-17.0
7.5
2014
-15.0
8.0
2015
-43.0
12.3
2016
67.8
7.9
2017
28.5
4.5
a. What was the standard deviation of the
market returns? (Use decimals, not percents, in your
calculations. Do not round intermediate calculations. Enter your
answer as a percent rounded to 2 decimal places.)
b. Calculate the average real return.
(A negative...
The following table shows the nominal returns on U.S. stocks and the rate of inflation. Year...
The following table shows the nominal returns on U.S. stocks and
the rate of inflation. Year Nominal Return (%) Inflation (%) 2010
13.6 3.7 2011 8.6 2.8 2012 16.0 3.3 2013 4.1 4.4 2014 −40.2 .4 a.
What was the standard deviation of the nominal market returns? (Do
not make the adjustment for degrees of freedom described in
footnote 18.) (Use decimals, not percents, in your calculations. Do
not round intermediate calculations. Enter your answer as a percent
rounded to...
The following table shows the nominal returns on U.S. stocks and the rate of inflation. Year...
The following table shows the nominal returns on U.S. stocks and
the rate of inflation.
Year
Nominal Return (%)
Inflation (%)
2010
11.7
2.2
2011
8.6
3.4
2012
15.5
2.9
2013
5.7
4.3
2014
−44.2
.3
a. What was the standard deviation of the
nominal market returns? (Do not make the adjustment for degrees of
freedom described in footnote 18.) (Use decimals, not
percents, in your calculations. Do not round intermediate
calculations. Enter your answer as a percent rounded to...
The following table shows the nominal returns on Brazilian stocks and the rate of inflation. Year...
The following table
shows the nominal returns on Brazilian stocks and the rate of
inflation.
Year
Nominal Return
(%)
Inflation
(%)
2012
0.2
6.9
2013
-16.0
7.0
2014
-14.0
7.5
2015
-42.5
11.8
2016
67.3
7.4
2017
28.0
4.0
a.
What was the standard deviation of the market returns?
b. Calculate the
average real return
The following table shows the nominal returns on Brazilian stocks and the rate of inflation. Year...
The following table shows the nominal returns on Brazilian
stocks and the rate of inflation.
Year Nominal Return (%) Inflation (%)
2012 0.5 6.8
2013 -14.0 6.9
2014 -12.0 7.4
2015 -42.4 11.7
2016 67.2 7.3
2017 27.9 3.9
a. What was the standard deviation of the market returns?
b. Calculate the average real return.
True or False. If profit and wages are both rising during inflation, the inflation must be...
True or False. If profit and wages are both rising during
inflation, the inflation must be a cost-pushed inflation.
Answer each question by True or False. Justify your answer. (1) True or False? The set...
Answer each question by True or False. Justify your answer.
(1) True or False? The set V = {p ∈ P2: p (7) = 0, p’ (7) = 0}
is a subspace of P2.
(2) True or False? The set of 2 by 2 matrices whose entries are
either all 0 or all nonzero is a subspace of the set of all 2 by 2
matrices M2×2(R).
(3) True or False? The set of all functions in C([0, 1]) such...
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