Question: A. Whencomparing thegeometricreturnofanindexwithitsarithmeticreturn,whichofthe following is false ? Thegeometricreturnwillneverexceedthearithmetic return Thegeometricreturnwillneverequalthearithmetic return Thegeometricreturnrepresentsaninternalrateofreturn,whilethearithmeticreturn typically does not Historicarithmeticreturnsaretypically chosenovergeometric returnsasinputswhen estimating future returns

A. Whencomparing thegeometricreturnofanindexwithitsarithmeticreturn,whichofthe following is false?

  1. Thegeometricreturnwillneverexceedthearithmetic return
  2. Thegeometricreturnwillneverequalthearithmetic return
  3. Thegeometricreturnrepresentsaninternalrateofreturn,whilethearithmeticreturn typically does not
  4. Historicarithmeticreturnsaretypically chosenovergeometric returnsasinputswhen estimating future returns

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