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2017-2018 16.92% 2018-2019 19.54% 2019-2020 0.36% 2020 2021 28.93% 2021-2022 -5.17% You have also collected the level of the CPI over the same period: Date March 2013 March 2014 March 2015 March 2016 March 2017 March 2018 March 2019 March 2020 March 2021 March 2022 Level 958 972 975 979 1000 1011 1026 1052 1068 1142 (a) For each tax year, calculate the inflation rate. (b) Now calculate a real rate of return for the NZX50 (use the full for- mula, not the approximation) for each year. (c) What is the mean nominal return for the NZX50? What is the mean real return? (d) What is the nominal volatility for the NZX50? What is the real volatility of the NZX50? (e) Suppose New Zealand had a 33% tax levied on capital gains and all dividends. Repeat your analysis, calculating after-tax mean real and nominal returns, along with real and nominal after-tax volatilities.

2017-2018 16.92% 2018-2019 19.54% 2019-2020 0.36% 2020 2021 28.93% 2021-2022 -5.17% You have also collected the level of the CPI over the same period: Date March 2013 March 2014 March 2015 March 2016 March 2017 March 2018 March 2019 March 2020 March 2021 March 2022 Level 958 972 975 979 1000 1011 1026 1052 1068 1142 (a) For each tax year, calculate the inflation rate. (b) Now calculate a real rate of return for the NZX50 (use the full for- mula, not the approximation) for each year. (c) What is the mean nominal return for the NZX50? What is the mean real return? (d) What is the nominal volatility for the NZX50? What is the real volatility of the NZX50? (e) Suppose New Zealand had a 33% tax levied on capital gains and all dividends. Repeat your analysis, calculating after-tax mean real and nominal returns, along with real and nominal after-tax volatilities.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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2. Over the last five years, you have earned the following returns on the NZX Year Return (ending in March) 2013-2014 17.45% 2014-2015 15.17% 2015-2016 17.26% 2016-2017 7.94% 2017-2018 16.92% 2018-2019 19.54% 2019-2020 0.36% 28.93% 2020 2021 2021-2022 -5.17% You have also collected the level of the CPI over the same period: Date Level March 2013 958 March 2014 972 March 2015 975 March 2016 979 March 2017 1000 March 2018 1011 March 2019 1026 March 2020 1052 March 2021 1068 March 2022 1142 (a) For each tax year, calculate the inflation rate. (b) Now calculate a real rate of return for the NZX50 (use the full for- mula, not the approximation) for each year. (c) What is the mean nominal return for the NZX50? What is the mean real return? (d) What is the nominal volatility for the NZX50? What is the real volatility of the NZX50? (e) Suppose New Zealand had a 33% tax levied on capital gains and all dividends. Repeat your analysis, calculating after-tax mean real and nominal returns, along with real and nominal after-tax volatilities.
Transcribed Image Text:2. Over the last five years, you have earned the following returns on the NZX Year Return (ending in March) 2013-2014 17.45% 2014-2015 15.17% 2015-2016 17.26% 2016-2017 7.94% 2017-2018 16.92% 2018-2019 19.54% 2019-2020 0.36% 28.93% 2020 2021 2021-2022 -5.17% You have also collected the level of the CPI over the same period: Date Level March 2013 958 March 2014 972 March 2015 975 March 2016 979 March 2017 1000 March 2018 1011 March 2019 1026 March 2020 1052 March 2021 1068 March 2022 1142 (a) For each tax year, calculate the inflation rate. (b) Now calculate a real rate of return for the NZX50 (use the full for- mula, not the approximation) for each year. (c) What is the mean nominal return for the NZX50? What is the mean real return? (d) What is the nominal volatility for the NZX50? What is the real volatility of the NZX50? (e) Suppose New Zealand had a 33% tax levied on capital gains and all dividends. Repeat your analysis, calculating after-tax mean real and nominal returns, along with real and nominal after-tax volatilities.
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