Answered: An investment produced annual rates of…

An investment produced annual rates of return of 5%, 12%, 8% and 11% respectively over the past four years. What is the (sample) standard deviation of these returns? A.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

An investment produced annual rates of return of 5%, 12%, 8% and 11% respectively over the past four years. What is the (sample) standard deviation of these returns?

3.8%

3.6%

3.2%

2.7%

Definition Definition Percentage gain or loss from a specific investment over time. The rate of return is the difference between the closing and initial values of an investment divided by the initial value of the investment. The closing value includes any intermediate cash flows such as dividends or interest amounts.

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