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If an investment costing $2,000 is expected to generate real cash flows of $900 p.a. for three years and prices are expected to increase at
If an investment costing $2,000 is expected to generate real cash flows of $900 p.a. for three years and prices are expected to increase at a rate of 10% p.a., what is the real required rate of return if the nominal rate of return is 15%?
Select one:
a. 6%
b. 5%
c. 1.05%
d. 4.55%
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