A stock has had the following year-end prices and dividends: What are the arithmetic and geometric returns
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A stock has had the following year-end prices and dividends:
What are the arithmetic and geometric returns for the stock?
Transcribed Image Text:
Price Year Dividend $64.18 $0.57 71.05 76.85 0.62 4 63.12 0.68 72.81 0.77 78.25 0.84
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To calculate the arithmetic and geometric average returns we must first calculate the return for each year The return for each year is R 1 7105 6418 057 6418 1159 or 1159 R 2 7685 7105 062 7105 0904 or 904 R 3 6312 7685 068 7685 1698 or 1698 R 4 7281 6312 077 6312 1657 or 1657 R 5 7825 7281 084 7281 0863 or 0863 The arithmetic average return ...View the full answer
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Related Book For
Essentials Of Corporate Finance
ISBN: 9780073382463
7th Edition
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
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