The Economics of Money, Banking and Financial Markets 4th Edition by Frederic Mishkin

تمرين 23

One of the points made in this chapter is that inflation erodes investment returns. Go to http://www.moneychimp.com/articles/econ/inflation_calculator.htm and review how changes in inflation alter your real return. What happens to the difference between the adjusted value of an investment and its inflation-adjusted value as
a. inflation increases?
b. the investment horizon lengthens?
c. expected returns increase?