Here are inflation rates and U.S. stock market and Treasury bill returns between 1929 and 1933: a.

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Here are inflation rates and U.S. stock market and Treasury bill returns between 1929 and 1933:

a. What was the real return on the stock market in each year?
b. What was the average real return?
c. What was the risk premium in each year?
d. What was the average risk premium?
e. What was the standard deviation of the risk premium?

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Principles of Corporate Finance

ISBN: 978-0077404895

10th Edition

Authors: Richard A. Brealey, Stewart C. Myers, Franklin Allen

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Question Posted: Dec 31, 2012 10:46 AM

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Here are inflation rates and U.S. stock market and Treasury bill returns between 1929 and 1933: a.

Question:

Year 1929 1930 1931 1932 1933 Inflation Stock Market Return -6.0 -9.5 -10.3 .5 -14.5 28.3 -43.9 9.9 57.3 T-Bill Return 4.8 2.4 1.1 1.0 .3

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ab Find the real return and average for the period by ...View the full answer

Principles of Corporate Finance

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