The nominal rate of return on the bonds of Stu's Boats is 9.75%.The real rate of return is 3.5%.What is the rate of inflation?

Name: The nominal rate of return on the bonds of Stu's Boats is 9.75%.The real rate of return is 3.5%.What is the rate of inflation?
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Quizplus · Accepted Answer

The rate of inflation can be found by subtracting the real rate of return from the nominal rate of return: 9.75% - 3.5% = 6.25%. Therefore, the best choice is B, which is closest to 6.25%.

The Nominal Rate of Return on the Bonds of Stu's