Question
Consider the following table for an eight-year period: Year T-bill return Inflation 1 7.41 % 8.59 % 2 8.64 12.22 3 5.99 6.82 4 5.67
Consider the following table for an eight-year period:
Year | T-bill return | Inflation | ||
1 | 7.41 | % | 8.59 | % |
2 | 8.64 | 12.22 | ||
3 | 5.99 | 6.82 | ||
4 | 5.67 | 4.98 | ||
5 | 5.57 | 6.58 | ||
6 | 8.24 | 8.90 | ||
7 | 10.68 | 13.17 | ||
8 | 12.70 | 12.40 | ||
Calculate the average return for Treasury bills and the average annual inflation rate (consumer price index) for this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Average return for Treasury bills | % = 8.11% |
Average annual inflation rate | % = 9.21% |
Calculate the standard deviation of Treasury bill returns and inflation over this time period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Standard deviation of Treasury bills | % |
Standard deviation of inflation | % |
Calculate the real return for each year. (A negative answer should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Year | Real return |
1 | % |
2 | % |
3 | % |
4 | % |
5 | % |
6 | % |
7 | % |
8 | % |
What is the average real return for Treasury bills? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Average real return for Treasury bills %
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