Say you own an asset that had a total return last year of 11.3 percent. If the i

Question

Say you own an asset that had a total return last year of 11.3 percent. If the inflation rate last year was 6.1 percent, what was your real return? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Say you own an asset that had a total return last year of 11.3 percent. If the inflation rate last year was 6.1 percent, what was your real return? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Explanation / Answer

r = (1 +0.113)/(1+0.061) -1

r = 0.049 = 4.9 %

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