Question: 3. Using the Ibbotson data on asset returns from Chapter 3 (Exhibit 3.11), what percentage of the equity risk premium is consumed by trading costs

3. Using the Ibbotson data on asset returns from Chapter 3 (Exhibit 3.11), what percentage of the equity risk premium is consumed by trading costs of 1.5 percent? Assuming a normal distribution of returns, what is the probability that an active manager can earn a return that will overcome these trading costs?

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