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2#
发表于 2011-7-11 19:53
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Inflation is included in return requirement if they ask for nominal return. It is excluded from liquidity calculation.
2007 Exam, the reason why it says increasing by inflation each year is that imagine this year you want to purchase $1000 worth of cheese. you will need $1000 available this year to purchase it. If you want to purchase the same amount of cheese next year, inflation will increase the cost to say $1,050 so you will need $1,050 next year. |
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