USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)

Real Returns
INVESTMENT	REAL ANNUAL RETURN
Large company stock	6.50%
Small capitalization stock	8.60%
Long-term corporate bonds	3.60%
Long-term government bonds	2.80%
U.S. Treasury bills	1.03%

The annual rate of inflation is 2.5% Refer to Exhibit 3-2. What is the T-bill nominal return?

	a.	6.19%
	b.	3.56%
	c.	9.16%
	d.	11.32%
	e.	5.37%