You are analyzing the performance of different asset classes for a foreign economy.You find that over the last 60 years the average annual return for equities was 12% while that of corporate bonds was 10% and the rate of inflation was about 3%.If inflation were projected to be around 1% for the foreseeable future,then what would you project the return of equities to be during that same foreseeable period?

Question

Quizplus · Accepted Answer

1% + (12% - 3%)= 10%

You Are Analyzing the Performance of Different Asset Classes for a Foreign