Use the data below to calculate the standard deviation of nominal and real Treasury bill returns from 1972-1982.
Do you think that when they purchased T-bills, investors expected to earn negative real returns as often as they did during this period? If not, what happened that took investors by surprise?
|
Year
|
Nominal Return (%)
|
Real Return (%)
|
|
1972
|
3.8
|
0.4
|
|
1973
|
6.9
|
-1.7
|
|
1974
|
8.0
|
-3.7
|
|
1975
|
5.8
|
-1.1
|
|
1976
|
5.1
|
0.3
|
|
1977
|
5.1
|
-1.5
|
|
1978
|
7.2
|
-1.7
|
|
1979
|
10.4
|
-2.6
|
|
1980
|
11.2
|
-1.0
|
|
1981
|
14.7
|
5.3
|
|
1982
|
10.5
|
6.4
|