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<p style="text-align:justify;"><span>(a) Nominal Rate × Inflation Rate, </span></p> <p style="text-align:justify;"><span>(b) </span><span>Nominal Rate ÷ Inflation Rate,</span></p> <p style="text-align:justify;"><span>(c) Nominal Rate - Inflation Rate,</span></p> <p style="text-align:justify;"><span>(d) </span><span>Nominal Rate + Inflation Rate</span></p>
Thanks for the invitation..answer is C
Real rate of return is actual increase in your wealth. According to fisher equation (1+m) = (1+r)(1+i)
m = money/ nominal rate, r = real rate, i = inflation rate
so,
R = (1+m ) divided by (1+i ) and less1
Nominal Rate - Inflation Rate.
Option C
C
Option- c
DEFINITION OF 'REAL RATE OF RETURN'
The annual percentage return realized on an investment, which is adjusted for changes in prices due to inflation or other external effects. This method expresses the nominal rate of return in real terms, which keeps the purchasing power of a given level of capital constant over time.
Right answer is option # (c) Nominal Rate - Inflation Rate,
C.
It's C.
(c) Nominal Rate - Inflation Rate, The correct answer.
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