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Real Rate of Return

Rate of return is a profit on an investment over a period of time, expressed as a proportion of the original investment. The real rate of return takes into account the inflation rate.

The real rate of return plus 1 equals the ratio of the sum of 1 and the nominal rate of return to the sum of 1 and the inflation rate.

Formula

1 + QuantityVariable[Subscript["r", "real"], "Unitless"] == (1 + QuantityVariable[Subscript["r", "nom"], "Unitless"])/(1 + QuantityVariable[Subscript["r", "inf"], "Unitless"])

symbol description physical quantity
rreal real rate of return "Unitless"
rinf inflation rate "Unitless"
rnom nominal rate of return "Unitless"

Forms

Examples

Get the resource:

In[1]:=
ResourceObject["Real Rate of Return"]
Out[1]=

Get the formula:

In[2]:=
FormulaData[ResourceObject["Real Rate of Return"]]
Out[2]=

Use some values:

In[3]:=
FormulaData[ResourceObject["Real Rate of Return"], {QuantityVariable[ \!\(\*SubscriptBox[\("r"\), \("real"\)]\),"Unitless"] -> Quantity[4, "Percent"]}]
Out[3]=

Publisher Information