Questions galore coming this weekend... weekend

LorrinCFA

Questions galore coming this weekend...

comp_sci_kid

so how exactly is this question figured out?

OmarAdnan

FinNinja Wrote:
-------------------------------------------------------
> Damil -
>
> US Real Risk free s/b approx. 2.5 not 3.5,
> correct?
>
> The way you calc this is:
> (1+nominal) = (1+real) * (1+ Infl.) right?
>
> so (1+real) = (1+nominal) / (1+ Infl.) or
> 1.04/1.015 = 2.46%, right - I'm only asking b/c
> I'm still a little fuzzy on this.

I see a lot of different equations used for the relation between real and nominal rates and inflation.

1) (1+real) = (1+nominal) / (1+ Infl.)
2) real = nominal - inflation

One for growth.. but I can't remember that one (if it is any different)

What is the difference between those two above? Is the real = nominal - inflation more of an approximation of the first one?

yalo

I just looked at the errata the only comment for Level 2 is "Question 43 on Afternoon is B."

The answer was already B on the PDF I looked at. Still didn't fix the one or two retarded questions they had.

mp3bu

rCAN 1.04 = (1+rr)(1.02)

rr = .0196

rUS 1.04 = (1+rr)(1.015)

rr = .0246

NO EXCUSES

wxs1986

Damil -

US Real Risk free s/b approx. 2.5 not 3.5, correct?

The way you calc this is:
(1+nominal) = (1+real) * (1+ Infl.) right?

so (1+real) = (1+nominal) / (1+ Infl.) or 1.04/1.015 = 2.46%, right - I'm only asking b/c I'm still a little fuzzy on this.

Sportsman

cpk:

where are errata posted for the samples and mocks?

onelife1

Canada Risk Free = 4% and Inflation = 2%. Real Rate of Return = approx. 2%

US Risk Free = 4% and Inflation = 1.5%. Real Rate of Return = approx. 3.5%

This is a ridiculous question.

ppls

.

NO EXCUSES



Edited 1 time(s). Last edit at Monday, May 24, 2010 at 02:39PM by bpdulog.

Uranus08

is this question 43 on the afternoon session?

If so, there is an erratum posted which says "Answer is B".

CP