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Suppose we have the following Treasury bill returns and inflation rates over an eight year period: Year Treasury Bills Inflation 1 8.27 10.02 2 9.09
Suppose we have the following Treasury bill returns and inflation rates over an eight year period: |
Year | Treasury Bills | Inflation |
1 | 8.27 | 10.02 |
2 | 9.09 | 13.55 |
3 | 6.19 | 7.33 |
4 | 5.32 | 5.04 |
5 | 5.77 | 7.09 |
6 | 8.03 | 9.48 |
7 | 11.02 | 13.80 |
8 | 12.70 | 13.30 |
a. Calculate the average return for Treasury bills and the average annual inflation rate (consumer price index) for this period
b. Calculate the standard deviation of Treasury bill returns and inflation over this period.
c.What was the average real return for Treasury bills over this period?
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