10-5 We know that during the last 10 years, the average historical return on a market index is 15%. We also know that the average inflation rate and average risk-free rate over the last 10 years are...

10-5

We know that during the last 10 years, the average historical return on a market index is 15%. We also know that the average inflation rate and average risk-free rate over the last 10 years are 3% and 6%, respectively. What is the real risk premium using the exact Fisher equation?

Select one:

a. 2.94%

b. 6.86%

c. 7.92%

d. 8.74%

e. 10.75%

Jun 07, 2022

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10-5 We know that during the last 10 years, the average historical return on a market index is 15%. We also know that the average inflation rate and average risk-free rate over the last 10 years are...

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