Consider the following table for different assets for 1926 through 2017. Series Average return Standard Deviation...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Consider the following table for different assets for 1926 through 2017. Series Average return Standard Deviation Large-company stocks 12.1% 19.8% Small-company stocks 16.5 317 Long-term corporate bonds 6.4 8.3 Long-term government bonds 6.0 99 Intermediate-term government 5.2 bonds 5.6 U.S. Treasury bills Inflation 33 3.4 3.1 3.0 4.0 a. What range of returns would you expect to see 68 percent of the time for long-term corporate bonds? (A negative answer should be indicated by a minus sign. Enter your answers from lowest to highest. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. What about 95 percent of the time? (A negative answer should be indicated by a minus sign. Enter your answers from lowest to highest. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g 32.16.) a. Expected range of returns b. Expected range of returns ge ge % to % % to % Consider the following table for different assets for 1926 through 2017. Series Average return Standard Deviation Large-company stocks 12.1% 19.8% Small-company stocks 16.5 317 Long-term corporate bonds 6.4 8.3 Long-term government bonds 6.0 99 Intermediate-term government 5.2 bonds 5.6 U.S. Treasury bills Inflation 33 3.4 3.1 3.0 4.0 a. What range of returns would you expect to see 68 percent of the time for long-term corporate bonds? (A negative answer should be indicated by a minus sign. Enter your answers from lowest to highest. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. What about 95 percent of the time? (A negative answer should be indicated by a minus sign. Enter your answers from lowest to highest. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g 32.16.) a. Expected range of returns b. Expected range of returns ge ge % to % % to %
Expert Answer:
Answer rating: 100% (QA)
a To calculate the range of returns that would be expected to see 68 percent of the time for longter... View the full answer
Related Book For
Corporate Finance Core Principles and Applications
ISBN: 978-0077905200
3rd edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford
Posted Date:
Students also viewed these finance questions
-
how costs will be reported throughout the project, how the reports will be sent, what the reports will cover, and what the reporting frequency will be.
-
"internet radios" for streaming audio, and personal video recorders and players. Describe design and evaluation processes that could be used by a start-up company to improve the usability of such...
-
Format only cells with values greater than maxim 4 tab and select Red color from the pallet (bottom ro Format only cells with values less than minimum and select Yellow color from the pallet (bottom...
-
As the new communications manager for International Gadgets, you have assembled a team of technical communicators with experience in communicating with various audiences in a business setting....
-
Repeat Exercise 24.16 for the DreamHome case study documented in Appendix A. (a) A suitable fragmentation schema for the system; (b) In the case of primary horizontal fragmentation, a minimal set of...
-
Mrs. Palsgraf was waiting for a train on a platform of a railroad. When a different train came into the station, two men ran to get on that train before it left the station. While one of the men...
-
Fernandez Corporation purchased a truck at the beginning of 2012 for $50,000. The truck is estimated to have a salvage value of $2,000 and a useful life of 160,000 miles. It was driven 23,000 miles...
-
Part A Learning Goal: To understand that the charge stored by capacitors represents energy; to be able to calculate the stored energy and its changes under different circumstances. An air-filled...
-
A month has elapsed since Precision Computer Centres year-end. Tony Freedman will use four specialized journals for recording business transactions in the month of Septemberyou will find two in...
-
A Lassonde Startup Company aims to expand its pump business into rural areas, where accessing clean water from underground wells can be challenging. Often, families struggle to extract water manually...
-
2. A child (mass 32.0 kg) is on a swing and has a speed of 3.82 m/s at the lowest point in her path. How high above this point will she swing?
-
what explain educational achievement gap between races? provide examples
-
Explain your viewpoint and experience with the concept of "zero-acquaintance." How might the use of artificial intelligence (AI) be used for identifying personality and perception? Are there AI or...
-
The wheel of a crank drive with radius R = 0.5m rotates on the ground. The collar A is on the wheel and moving along the bar BE. At the time instant, the absolute velocity and absolute acceleration...
-
A 7m long beam AC is fixed at both ends and is loaded as shown below. i) Find the end reactions and fixing moments. ii) Draw the shear force and bending moment diagrams. 8kN/m 4.5m 80KN B 60kNm 2.5m
-
You are considering three alternative investments. Investment X offers a return of 1.5% per month compound interest. Investment Y offers a payoff of $895.65 after four years in return for savings of...
-
If a force of F = 50 Ib is applied to the pads at A and C, determine the smallest dimension d required for equilibrium if the spring has an unstretched length of 1 ft. B 1 ft 1 ft F k = 15016/fr 1ft...
-
Levered, Inc., and Unlevered, Inc., are identical in every way except their capital structures. Each company expects to earn $275,000 before interest per year in perpetuity, with each company...
-
Consider a project to supply Detroit with 60,000 tons of machine screws annually for automobile production. You will need an initial $3,250,000 investment in threading equipment to get the project...
-
Shane's Toys Inc. just purchased a $325,000 machine to produce toy cars. The machine will be fully depreciated by the straight-line method over its five-year economic life. Each toy sells for $32....
-
Suppose you operate a bank in a country where the central bank is expected to embark on a series of interest rate increases. Based on gap analysis, would this scenario be more likely to hurt or help...
-
Cyber risk has been recognized as a growing source of operational risk for financial institutions. Why might managing this risk at an individual firm level not be adequate?
-
Bank assets equal bank liabilities plus bank capital. a. Bank assets are the uses for bank funds. i. They include reserves, securities, and loans. ii. Over the years, commercial and industrial loans...
Study smarter with the SolutionInn App