book nt Consider the following table for a period of six years: Returns U.S. Treasury Year Large-Company Stocks Bills 1 -14.99% 7.35% 2 -26.56 8.02 3 37.29 5.93 4 23.99 5.37 5 -7.28 5.48 6 6.63 7.73 a-1. Calculate the arithmetic average returns for large-company stocks and T-bills over this time period. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a-2. Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. int Large-company stocks T-bills a-1. Arithmetic average return a-2. Standard deviation % % % % ences Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. b-1. What was the arithmetic average risk premium over this period? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b-2. What was the standard deviation of the risk premium over this period? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
book nt Consider the following table for a period of six years: Returns U.S. Treasury Year Large-Company Stocks Bills 1 -14.99% 7.35% 2 -26.56 8.02 3 37.29 5.93 4 23.99 5.37 5 -7.28 5.48 6 6.63 7.73 a-1. Calculate the arithmetic average returns for large-company stocks and T-bills over this time period. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a-2. Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. int Large-company stocks T-bills a-1. Arithmetic average return a-2. Standard deviation % % % % ences Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. b-1. What was the arithmetic average risk premium over this period? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b-2. What was the standard deviation of the risk premium over this period? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter15: Capital Investment Analysis
Section: Chapter Questions
Problem 15.5.2MBA: Financial leverage Costco Wholesale Corporation (COST) and Wel-Mart Stroes Inc. (WMT)reported the...
Related questions
Question
![book
nt
Consider the following table for a period of six years:
Returns
U.S. Treasury
Year Large-Company Stocks
Bills
1
-14.99%
7.35%
2
-26.56
8.02
3
37.29
5.93
4
23.99
5.37
5
-7.28
5.48
6
6.63
7.73
a-1. Calculate the arithmetic average returns for large-company stocks and T-bills over this time period.
Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.
a-2. Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period.
Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.
int
Large-company
stocks
T-bills
a-1. Arithmetic average return
a-2. Standard deviation
%
%
%
%
ences
Calculate the observed risk premium in each year for the large-company stocks versus the T-bills.
b-1. What was the arithmetic average risk premium over this period?
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a
percent rounded to 2 decimal places, e.g., 32.16.
b-2. What was the standard deviation of the risk premium over this period?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffbb515f7-e22b-426a-a67a-dcfd90af8bdd%2F9c1c70ce-ee3d-4258-8303-ad1d4eb289d5%2F7rxpnun_processed.png&w=3840&q=75)
Transcribed Image Text:book
nt
Consider the following table for a period of six years:
Returns
U.S. Treasury
Year Large-Company Stocks
Bills
1
-14.99%
7.35%
2
-26.56
8.02
3
37.29
5.93
4
23.99
5.37
5
-7.28
5.48
6
6.63
7.73
a-1. Calculate the arithmetic average returns for large-company stocks and T-bills over this time period.
Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.
a-2. Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period.
Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.
int
Large-company
stocks
T-bills
a-1. Arithmetic average return
a-2. Standard deviation
%
%
%
%
ences
Calculate the observed risk premium in each year for the large-company stocks versus the T-bills.
b-1. What was the arithmetic average risk premium over this period?
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a
percent rounded to 2 decimal places, e.g., 32.16.
b-2. What was the standard deviation of the risk premium over this period?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
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