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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 9.01% 10.86% 2 9.87 14.41
Suppose we have the following Treasury bill returns and inflation rates over an eight-year period: |
Year | Treasury Bills | Inflation |
1 | 9.01% | 10.86% |
2 | 9.87 | 14.41 |
3 | 7.62 | 8.80 |
4 | 6.71 | 6.39 |
5 | 7.20 | 8.56 |
6 | 9.50 | 10.99 |
7 | 12.33 | 15.15 |
8 | 14.09 | 14.89 |
a. | Calculate the average return for Treasury bills and the average annual inflation rate for this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
b. | Calculate the standard deviation of Treasury bill returns and inflation over this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
c. | What was the average real return for Treasury bills over this period? (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.) |
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