Question
During the past year, you had a portfolio that contained U.S. government T-bills, long-term government bonds, and common stocks. The rates of return on each
During the past year, you had a portfolio that contained U.S. government T-bills, long-term government bonds, and common stocks. The rates of return on each of them were as follows: U.S. government T-bills 5.70 % U.S. government long-term bonds 8.50 U.S. common stocks 11.40 During the year, the consumer price index, which measures the rate of inflation, went from 100 to 117 (1982 1984 = 100). Compute the rate of inflation during this year. Round your answer to one decimal place. 17 % Compute the real rates of return on each of the investments in your portfolio based on the inflation rate. Use a minus sign to enter negative values, if any. Do not round intermediate calculations. Round your answers to two decimal places. Real rate of return U.S. government T-bills 0 % U.S. government long-term bonds 0 % U.S. common stocks 0 %
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