Real Rate of Return Calculator
Real Rate Of Return Calculator
The real rate of return is the annual percentage(%) of return on an investment. The Real Rate of Return Equal to 1 numbers of value added to nominal Rate of return(%) divided to 1 number of value added to annual inflation rate(%) less then 1.0 number of value.
formula us,
Real Rate of Return = (1 + rnom) / (1 + π) − 1.0
let us Consider,
- rᵣ – real rate of return;
- rnom – nominal rate of return; and
- π – annual inflation rate.
Calculate the Real Rate Of Return
It is a simple calculator with only three variables, which are the following:
Real Rate of Return = (1 + rnom) / (1 + π) − 1.0
- Nominal rate of return(5%)
- Inflation rate(3%)
- Real rate of return is 1.9417 %