Expected inflation over the next year is E p 10 What nominal interest rate i should investors charge on the following assets a Investors require a real rate of return of 2 percent on a one year corporate bond b Investors require a real return of 6 percent on a portfolio of stocks c Investors requir...

Nominal interest rates are calculated from the ...

Expected inflation over the next year is E[p] = 10%. What nominal interest rate i should investors

Question:

Expected inflation over the next year is E[p] = 10%. What nominal interest rate i should investors charge on the following assets?
a. Investors require a real rate of return of ʀ = 2 percent on a one-year corporate bond.
b. Investors require a real return of ʀ = 6 percent on a of stocks.
c. Investors require a real return of ʀ = 10 percent on an investment in an oil field.
Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...