risk premium, confusing reading, return, problems, practice

dofan

How to calculate risk premium?

In the practice problems in the reading, it's (1+nominal return)/(1+risk free return)

However, in the mock exam, it's (1+real return)/(1+risk free return)

Which formula should I use?
I think the first formula makes more sense.

Thanks a lot!!!

ScheinSlayer

i think in most cases there won't be big difference between them