A "real return" is

A) a return that has not been adjusted for inflation.

B) the type of return that is quoted for securities by the financial press.

C) the return that a security would have earned had there been no inflation.

D) both A and B.

Your savings account yielded 1.5% last year.The inflation rate was 2%.What real return did you earn on this account?Round your answer to the nearest tenth of a percent.

A) +0.1%

B) +1.0%

C) -0.5%

D) -1.0%

Which of the following statements is (are) true?

A)The arithmetic average rate of return will always be greater than the geometric average rate of return.

B)The geometric average rate of return will always be greater than the arithmetic average rate of return.

C)The difference between the geometric and arithmetic average rate of returns will be greater, the greater the variability of the annual returns.

D)Both A and C are true statements.