Question: Problem 10-8 Risk Premiums [LO 2] Consider the following table for a period of six years: Returns Year Large-Company Stocks U.S. Treasury Bills 1 14.79
Problem 10-8 Risk Premiums [LO 2]
| Consider the following table for a period of six years: |
| Returns | |||||||
| Year | Large-Company Stocks | U.S. Treasury Bills | |||||
| 1 | 14.79 | % | 7.31 | % | |||
| 2 | 26.50 | 8.00 | |||||
| 3 | 37.25 | 5.89 | |||||
| 4 | 23.95 | 5.17 | |||||
| 5 | 7.20 | 5.46 | |||||
| 6 | 6.59 | 7.67 | |||||
| a-1. | Calculate the arithmetic average returns for large-company stocks and T-bills over this time period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
| a-2. | Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
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