# Question

What if the last two decades had been “normal”? Download the spreadsheet from MyFinanceLab containing the data for Figure 10.1.

a. Calculate the arithmetic average return on the S&P 500 from 1926 to 1989.

b. Assuming that the S&P 500 had simply continued to earn the average return from (a), calculate the amount that $100 invested at the end of 1925 would have grown to by the end of 2011.

c. Do the same for small stocks.

a. Calculate the arithmetic average return on the S&P 500 from 1926 to 1989.

b. Assuming that the S&P 500 had simply continued to earn the average return from (a), calculate the amount that $100 invested at the end of 1925 would have grown to by the end of 2011.

c. Do the same for small stocks.

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