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Assume these were the inflation rates and U.S. stock market and Treasury bill returns between 1929 and 1933: Year Inflation(%) Stock Market Return(%) T-Bill Return(%)
Assume these were the inflation rates and U.S. stock market and Treasury bill returns between 1929 and 1933:
Year | Inflation(%) | Stock Market Return(%) | T-Bill Return(%) |
1929 | 0.2 | 14.7 | 6.1 |
1930 | 5.5 | 31.7 | 3.8 |
1931 | 9.9 | 47.3 | 1.6 |
1932 | 11.4 | 12.0 | 0.7 |
1933 | 1.2 | 58.7 | 0.4 |
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What was the real return on the stock market in each year?
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What was the average real return?
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What was the risk premium in each year?
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What was the average risk premium?
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