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Problem 2: Given the data: nominal rate of return=8%, inflation rate=3%, market return=12%, risk free rate=7%. 1. Calculate risk premium. Is it worth it or

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Problem 2: Given the data: nominal rate of return=8%, inflation rate=3%, market return=12%, risk free rate=7%. 1. Calculate risk premium. Is it worth it or not. Explain with your risk type test. 2. Calculate real rate of return. 3. If inflation rate increases from 3% to 8%, what will be the new real rate of return

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