The ex-post real rate of return is a backward-looking measure calculated after the fact, using
historical data. It reflects the actual nominal rate of return adjusted for the actual rate of inflation
over the same period. The formula is:
Ex-postrealreturn=Nominalreturn−Inflationrate\text{Ex-post real return} = \text{Nominal return} -
\text{Inflation rate}Ex-postrealreturn=Nominalreturn−Inflationrate
This measure helps assess the purchasing power of returns after accounting for inflation.
Other options are incorrect:
A and C describe ex-ante measures (forward-looking expectations).
B calculates the nominal excess return above the risk-free rate, not the real return.
