Ask Question
11 November, 17:05

The inflation premium: Question 4 options: should be an average of the inflation rate experienced in the past. should be an average of the inflation rate expected over the life of the security. is required for assets that cannot be converted into cash on short notice at a reasonable price. reflects interest rate risk.

+3
Answers (2)
  1. 11 November, 17:13
    0
    The correct answer is letter "B": should be an average of the inflation rate expected over the life of the security.

    Explanation:

    The Inflation premium (IP) is a premium that represents the projected inflation investors must add to the real risk-free rate of return until the date of maturity. IP has an impact on interest rates because it affects the real value of what investors receive from their venture.
  2. 11 November, 19:40
    0
    The answer is should be an average of the inflation rate expected over the life of the security.

    Explanation:

    The inflation premium is a portion of the interest rate that compensates the investor for the expected increase in prices over time
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The inflation premium: Question 4 options: should be an average of the inflation rate experienced in the past. should be an average of the ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers