Suppose that a yearly inflation was 5%. Calculate real rates returns on the assets listed. painting :
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Question:
Suppose that a yearly inflation was 5%. Calculate real rates returns on the assets listed.
painting:
(250,000 - 200,000) / 200,000
rate of return 25%
Bottle of burgundy:
(275-255)/255
rate of return: 7.84%
b. Can the real rate of return be lower than the nominal rate of return?
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ISBN: 978-1133939153
9th edition
Authors: Karla Johnstone, Audrey Gramling, Larry Rittenberg
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