a. Use the data given to calculate annual returns for Bartman, Reynolds, and the Market Index, and then calculate average returns over the five-year period. Remember, returns are calculated by subtracting the beginning price from the ending price to get the capital gain or loss, adding the dividend to the capital gain or loss, and dividing the result by the beginning price. Assume that dividends are already included in the index.   Also, you cannot calculate the rate of return for 2005 because you do not have 2004 data.

Data as given in the problem are shown below:\r\n

Bartman Industries		Reynolds Incorporated		Market Index
Year	Stock Price	Dividend	Stock Price	Dividend	Includes Divs.
2010	$17.250	$1.150	$48.750	$3.000	11,663.98
2009	14.750	1.060	52.300	2.900	8,785.70
2008	16.500	1.000	48.750	2.750	8,679.98
2007	10.750	0.950	57.250	2.500	6,434.03
2006	11.375	0.900	60.000	2.250	5,602.28
2005	7.625	0.850	55.750	2.000	4,705.97

We now calculate the rates of return for the two companies and the index:\r\n

Bartman	Reynolds	Index
2010
2009
2008
2007
2006
Average

Note: To get the average, you could get the column sum and divide by 5, but you could also use the function wizard, fx. Click fx, then statistical, then Average, and then use the mouse to select the proper range. Do this for Bartman and then copy the cell for the other items.\r\n

b. Calculate the standard deviation of the returns for Bartman, Reynolds, and the Market Index. (Hint: Use the sample standard deviation formula given in the chapter, which corresponds to the STDEV function in Excel.)  \r\n

Use the function wizard to calculate the standard deviations.\r\n

Bartman	Reynolds	Index
Standard deviation of returns
c. Now calculate the coefficients of variation Bartman, Reynolds, and the Market Index.

Bartman	Reynolds	Index
Coefficient of Variation
d. Construct a scatter diagram graph that shows Bartman