Question: Over a 40-year period an asset had an arithmetic return of 11.7 percent and a geometric return of 9.6 percent. Using Blumes formula, what is

Over a 40-year period an asset had an arithmetic return of 11.7 percent and a geometric return of 9.6 percent. Using Blume’s formula, what is your best estimate of the future annual returns over 5 years? 10 years? 20 years?

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