The stock of Oakmont Inc. had the following prices and dividends. What is the geometric average...
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The stock of Oakmont Inc. had the following prices and dividends. What is the geometric average return on this stock? Year 2022 2021 2020 2019 Price (end of year) $45.20 $35.57 $26.00 $33.50 Dividend $1.20 $1.15 $1.10 $1.05 Problem #2 (7 marks) Consider the following historical returns on Muirfield Limited shares. Assume the average risk- +free rate during the 2016-2022 period was equal to 1.9%. Year TB Return 2022 16% 2021 8% 2020 12% 2019 -15% 2018 5% 2017 0% 2016 25% a) Calculate the arithmetic average return and the risk premium for Muirfield Limited. (3 marks) b) Calculate the standard deviation for Muirfield Limited using the arithmetic average return. (4 marks) The stock of Oakmont Inc. had the following prices and dividends. What is the geometric average return on this stock? Year 2022 2021 2020 2019 Price (end of year) $45.20 $35.57 $26.00 $33.50 Dividend $1.20 $1.15 $1.10 $1.05 Problem #2 (7 marks) Consider the following historical returns on Muirfield Limited shares. Assume the average risk- +free rate during the 2016-2022 period was equal to 1.9%. Year TB Return 2022 16% 2021 8% 2020 12% 2019 -15% 2018 5% 2017 0% 2016 25% a) Calculate the arithmetic average return and the risk premium for Muirfield Limited. (3 marks) b) Calculate the standard deviation for Muirfield Limited using the arithmetic average return. (4 marks)
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Problem 1 To calculate the geometric average return for Oakmont Inc you can use the formula Geometri... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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