Question

Exercise 19-5 Algo A portfolio manager invested $1,700,000 in bonds in 2007. In one year the...

Exercise 19-5 Algo

A portfolio manager invested $1,700,000 in bonds in 2007. In one year the market value of the bonds dropped to $1,686,000. The interest payments during the year totaled $114,000.

a.

What was the manager’s total rate of return for the year? (Round your answer to 2 decimal places.)  

  Total rate of return %


b.

What was the manager’s real rate of return if the inflation rate during the year was 2.3%? (Round your answer to 2 decimal places.)

  

  Real rate of return %

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