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Your share portfolio has an expected nominal total return of 8% pa and a nominal dividend return of 3% PA. Inflation is expected to be 2% pA. All of the above rates are nominal effective rates and investors believe that they will stay the same in perpetuity. Which of the following statements is NOT correct? Marked out of 1.00 a. The nominal expected capital return is 5% pa. P Flag question O b. The real expected capital return is 2.9412% pa. O c. The real expected total return is 5.8824% pa. O d. The real expected dividend return is 0.9 4% pa. e. In real terms, share prices will rise. In nominal terms, share prices will increase by more than the rate of inflation.

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