In: Finance
Say you own an asset that had a total return last year of 16 percent. If the inflation rate last year was 5.5 percent, what was your real return? Multiple Choice • 9.85% • 9.95% • -9.05% • 10.05% • 10.15%
(1+nominal return)=(1+real return)*(1+inflation rate)
real return =(1+16%)/(1+5.5%)-1
real return =9.95%