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TABLE 12.2 Average Annual Returns: 1926-2016 Investment Large-company stocks Small-company stocks Long-term corporate bonds Long-term government bonds U.S. Treasury bills Inflation Source: Morningstar, 2017, author

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TABLE 12.2 Average Annual Returns: 1926-2016 Investment Large-company stocks Small-company stocks Long-term corporate bonds Long-term government bonds U.S. Treasury bills Inflation Source: Morningstar, 2017, author calculations. Average Return 12.0% 16.6 6.3 6.0 3.4 3.0 3 10 points eBook B CO Hint Print Check my work Refer to Table 12.2. a. What was the average annual return on large-company stock from 1926 through 2016 in nominal terms? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What was the average annual return on large-company stock from 1926 through 2016 in real terms? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Nominal return % b. Real return %

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