Consider the following information on large-company stocks, Ask an Expert

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Consider the following information on large-company stocks for a period of years.

Series Arithmetic Mean
Large-company stocks 13.5%
Small-company stocks 16.4
Long-term corporate bonds 6.2
Long-term government bonds 6.1
Intermediate-term government bonds 5.6
U.S. Treasury bills 3.8
Inflation 4.0

Required:

(a)What was the arithmetic average annual return in nominal terms?

(b)What was the arithmetic average annual return in real terms?

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