The nominal risk free rate is equal to 10%. The inflation rate is 2%. At t = 0 a hamburger costs $1. Consider the following desired consumption stream: At t = 30 you want to spend $5,000. Then you want to consume 4% more hamburgers until t = 50, and then 5% more hamburgers until t = 65. Assume that you are using the real approach to calculate the PV of all those cash flows. You write down the following equation. 1 PV = 4661 B-C (1 + DF (1 + E)F)(1+G)H (1 + L)N (1+M)N)(1+P) 1 What should the value of A be in this equation? 5,000(1.02) 5,000/(1.02)30 5,000(1.02)30 None of the above 5,000 The nominal risk free rate is equal to 10%. The inflation rate is 2%. At t = 0 a hamburger costs $1. Consider the following desired consumption stream: At t = 30 you want to spend $5,000. Then you want to consume 4% more hamburgers until t = 50, and then 5% more hamburgers until t = 65. Assume that you are using the real approach to calculate the PV of all those cash flows. You write down the following equation. A 1 PV = c 1 B-C (1 + DF (1 + E)F) (1 + GH (1 + L)N 1 1 (1 + M)N) (1 + P) What should the value of D be in this equation? 2% None of the above 4% 10% 5%