Subtracting the inflation rate from the interest rate on a bond coupon allows for easy calculation of _____. Select the best answer from the choices provided. A. investment doubling times B. inflation effects C. default risk D. TIPS values

Question

04-02-2020
Business

contestada

Subtracting the inflation rate from the interest rate on a bond coupon allows for easy calculation of _____. Select the best answer from the choices provided. A. investment doubling times B. inflation effects C. default risk D. TIPS values

Respuesta :

Otras preguntas

What was the effect of the passage of the 18th Amendment to the United States constitution on alcohol consumption? a. There was no effect. b. Consumption decrea

i Need Help please!!!!

can you please help me solve?

Which statement is an example of a theme

What is the constant to

Given the graph of y=x^2, what are the zeros of the function after the transformation down 4 units and left 3 units? A. x=-2, x=2 B. x=3 C. x=-5, x=-1 D. x=-4,

The controversy over Missouri's request for statehood: did not affect the balance of power in Congress was settled by the Missouri Compromise precipitated the W

If a negatively-charged rod is brought close to an electroscope that is negatively charged, what will the two leaves of the electroscope do? move closer togethe

Question 11 of 30 1 Point Which technology is important in the detection of cancer? 0 O A. Continuous glucose monitoring O O B. Chemotherapy c. Radiation n MRI

Question 16 of 20: Select the best answer for the question. 16. An amoeba moves by pushing out small projections called rest of the organism along. and then pul

sadddamkashmiri801 sadddamkashmiri801 · Answer 1 · 2020-02-05T11:11:24+01:00

Answer:

The Option C is correct because the return desired on an investment is always sum of two things, return on default risk and return for inflation compensation.

Desired return = Return on Default risk %age + Inflation compensation %age

So what we earn in real terms is return on defaul risk. The return in nominal term (also known as money terms) is always higher in percentage because the percentage also includes the inflation compensation.