Rate of Return 1. If a bond has a current yield of 6% and a rate of return of 2%, it has a capital gain or loss. 2. If a bond has a 2% rate of return and a capital loss of 4%, its current yield is Real and Nominal Interest Rates 3. If the nominal interest rate is 4% and expected inflation is -4%, the real interest rate is ? 4. If the nominal interest rate is 6%, the expected rate of inflation is 4% and the actual rate of inflation is 6%, the ex post real interest rate is ?

Rate of Return 1. If a bond has a current yield of 6% and a rate of return of 2%, it has a capital gain or loss. 2. If a bond has a 2% rate of return and a capital loss of 4%, its current yield is Real and Nominal Interest Rates 3. If the nominal interest rate is 4% and expected inflation is -4%, the real interest rate is ? 4. If the nominal interest rate is 6%, the expected rate of inflation is 4% and the actual rate of inflation is 6%, the ex post real interest rate is ?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter17: Capital And Time

Section: Chapter Questions

Problem 17.7P

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