Question: You have found an asset with an arithmetic average return of 13.30 percent and a geometric average return of 10.38 percent. Your observation period is

You have found an asset with an arithmetic average return of 13.30 percent and a geometric average return of 10.38 percent. Your observation period is 30 years. What is your best estimate of the return of the asset over the next 5 years? 10 years? 20 years?

A stock has returns of 9 percent, 11 percent, 10 percent, 16 percent, and 3 percent. What are the arithmetic and geometric returns?

The rates of return on Cherry Jalopies, Inc., stock over the last five years were 18 percent, 11 percent, 1 percent, 2 percent, and 11 percent. Over the same period, the returns on Straw Construction Companys stock were 16 percent, 19 percent, 5 percent, 2 percent, and 21 percent.

Calculate the variances and the standard deviations for Cherry and Straw.

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