1. Over the past five years, a stock provided annual returns of 12.6 percent, 5.8 percent,...
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1. Over the past five years, a stock provided annual returns of 12.6 percent, 5.8 percent, 7.9 percent, -11.2 percent and -2.4 percent. What is the arithmetic average return? What is the geometric average return? What is the variance of these returns? What is the standard deviation of these returns? 2. Refer to Problem 1. If the risk-free rate is 2%, what is the risk premium on the stock? Note: use the arithmetic average return in your computation. 3. A company had returns of 5%, 10%, -15%, 20%, -12%, 22%, 8% in the last few years. Compute the arithmetic average return, geometric average return, variance, and standard deviation of returns. 4. Refer to Problem 3. If the risk-free rate is 2%, what is the risk premium on the stock? Note: use the arithmetic average return in your computation. Also upload your excel files showing your work. 1. Over the past five years, a stock provided annual returns of 12.6 percent, 5.8 percent, 7.9 percent, -11.2 percent and -2.4 percent. What is the arithmetic average return? What is the geometric average return? What is the variance of these returns? What is the standard deviation of these returns? 2. Refer to Problem 1. If the risk-free rate is 2%, what is the risk premium on the stock? Note: use the arithmetic average return in your computation. 3. A company had returns of 5%, 10%, -15%, 20%, -12%, 22%, 8% in the last few years. Compute the arithmetic average return, geometric average return, variance, and standard deviation of returns. 4. Refer to Problem 3. If the risk-free rate is 2%, what is the risk premium on the stock? Note: use the arithmetic average return in your computation. Also upload your excel files showing your work.
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Year 1 2 3 4 5 1 Arithmetic Avg Variance Year 2 Risk ... View the full answer
Related Book For
Government and Not for Profit Accounting Concepts and Practices
ISBN: 978-1118155974
6th edition
Authors: Michael H. Granof, Saleha B. Khumawala
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