By NEAS - 8/15/2018 5:20:14 PM
Macro Module 15 real rate of return practice exam questions
(The attached PDF file has better formatting.)
Question 15.1: Real rates of return
● The real return on capital R/P is 22.21%
● The utilization rate of capital (lowercase κ) is 73.33%
● The depreciation rate is 4.77%
What is the real rate of return on bonds?
Answer 15.1: 73.33% × 22.21% – 4.77% = 11.52%
(real rate of return on bonds = real return on capital × utilization rate of capital – depreciation rate)
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