(Selving a comprehensive problem) Use the end-of-year stock price data in the popup window, Pirwheel companies. to answer the following questions for the Harris and a. Compute the annual rates of return for each time period and for beth firms. b. Calculate both the arthmetic and the geometric mean fates of return for the entire three-year periad using your annual rates of return from part a. (Nose. you may assume that neither fem pays any dividends.) c. Compute a three-year rate of return spanning the entire period (i.e., using the ending price for period 1 and ending price for period 4). d. Since the rate of return calculated in part c is a three-year rate of return, convert it to an annual fate of return by using the following equation: (ThreeYearRateofRotum)=(AnnualRateofRetim)3 e. How is the annual rate of relurn colculated in part d related to the gecrotric rate of retuin? When you are evaluating the pertommance of an imvestment that has been held for several years, what type of average rate of return (arithmetic or geometric) should you use? Why? a. Enter the annual rate of return for each year for Harris in the table below. (Round to two decimal places:) (Solvine a comorehensive problem) Use the and-of-vear stock Drice data in the Docuo window. to answor the following aisstions for the Harris and - \% a. Enter the anmual rate of refurn tor each year tor Harris in the table below. (Hound to two decimal places.) Enter the annual rate of return for each year for Pirwheel in the table below. (Round to two decimal places.) b. The anthmetic average rate of retum eamed by investing in Harris stock over thas period is 25. (Round to two decimal places:) b. The arithmetic average rate of refurm earned by investing in Hartis slock over tyis period is (Pound to two decimal places ) The arithmetid avetage rate of retuan eamed by imvestng in Pirwheet stock over this period is \%. (Round to two decimal places.) The geometric average rate of requen eamed by investing in Haris stock wver this period is 4. (Round to two decimal places) The goometric average rate of return eamed by irvesting in Fimaheel stock over inis period is \%. (Round to two decimal placet) c. Thet three year rate of reluen spanning the entire period for Harris is 1. (Round to kwo decimal places.) The three-year rate of return sparning the entire peniod for Pinwheef is \%. (Round to tao decimal places.) d. The annual rate of return coctyerted from the three-year rate in part e for Harris is 16. (flound to two decinial places.) The annual rate of retum converted from the three-year rate in part c for Pinwheel is 16. (Found to two decimat places.) e. How is the anmual rate of return calcutatod in pact d related to the goometric rase of return? (Seloct the best cheice below.) A. The annual rate of return calculated in part d is the same as the gocmetric rate of return in this problem but this is only a coincidench B. The annual rast of relian calculated in part d is nothing but ehe arthmetic average rate of return calculated in a bifferent auy. e. How is the annual rate of return calculated in part d related to the geometric rate of return? (Select the best choice below.) A. The annual rate of return calculated in part d is the same as the georsetric rate of return in this problem but this is only a coincidence B. The annual rate of retum calculated in part d is nothing but the arithmetic average rate of return calculated in a different way. C. The annual rate of return calculated in part d is not related to the geometric averape rate of feturn. D. The annual rate of return calculated in part d is nothing but the geometric averape rate of return caiculated in a different way When you are evaluating the performance of an investment that has been hold for several years, what type of average rate of return (arthmetic or geornetrie) shouid you use? Why? (Select the best choice below.) A. The geometric rate of return should be used. It better describes the average annual rate of roturn over a period because it compounds at the same rate while the arithmetic rate of retum is best used for a single period. B. Arithmetic average relum better describes the average annual rate of return over a period because it is a simple average, so it answers the questien concerning the expected rate of return over a period. c. The arithmetic rate of retum should be used. it better describes the average annual rate of return over a period because it compounds at the same fate while the geometric rale of return is best used for a single period D. Geometric average return better describes the average annual rate of return over a period because it is a simple average, so it answers the question concerning the expected rate of return over a period