Question

What factor influences the rate of return on equities?

a.

Risk-free rate of interest

b.

Policy surrender rates

c.

Rate of inflation

d.

Advertising expenses

Answer: (c).Rate of inflation Explanation:The rate of return on equities is influenced by the rate of inflation in the economy, as it affects the real returns on investments.

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Q. What factor influences the rate of return on equities?

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