(Answered) Problem nominal vs real returnscollapsea an investment

Accounting

Problem: Nominal vs Real ReturnsCOLLAPSE

A. An investment offers a total return of 14% over the coming year. You believe the real return on this investment will be only 10%. What do you believe the inflation rate will be over the next year?

B. If inflation rate in the next year is 3% and if you want the real return of 8%, what is the nominal return that you require from an investment?

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