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In the Model of This Chapter the Nominal Rate of Return

Question 17

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In the model of this chapter the nominal rate of return on capital, (R/P) - In the model of this chapter the nominal rate of return on capital, (R/P) - is greater than the nominal return on bonds, i, because capital is viewed by households as more risky than bonds. is greater than the nominal return on bonds, i, because capital is viewed by households as more risky than bonds.

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