Calculate the nominal rate of return by using real rate of return and the expected inflation rate of 2.2% and tell me how to use the investment appraisal methods after doing this?
Thanks for help.
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Calculate the nominal rate of return by using real rate of return and the expected inflation rate of 2.2% and tell me how to use the investment appraisal methods after doing this?
Thanks for help.
With the one-period real return r, the inflation rate i, and the nominal return n all expressed as decimals, the following equality holds...
(1 + n) = (1 + r)(1 + i)
Given any two of the three you can quickly find the third.
As to the second part of your question, explain that a bit more, and tell me your thoughts on it.
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