Consider the following information on large-company stocks for a period of years.ArithmeticMean12.783.3Large-company stocksInflationa. What was the arithmetic average annual return on large-company stocks in nominal terms?Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places,e.g., 32.16.b. What was the arithmetic average annual return on large-company stocks in real terms?Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places,e.g., 32.16.a. Nominal returnb. Real return12.70%10.26 %

Arithmetic Mean =12.70%Inflation rate-3.3%Required:Arithmetic average annual return in nominal…

Consider the following information on large-company stocks for a period of y Arithmetic Mean 12.7% 3.3 Large-company stocks Inflation a. What was the arithmetic average annual return on large-company stock Note: Do not round intermediate calculations and enter your answer e.g., 32.16. b. What was the arithmetic average annual return on large-company stock Note: Do not round intermediate calculations and enter your answer e.g., 32.16. a. Nominal return b. Real return 12.70% 10.26 %

Consider the following information on large-company stocks for a period of y Arithmetic Mean 12.7% 3.3 Large-company stocks Inflation a. What was the arithmetic average annual return on large-company stock Note: Do not round intermediate calculations and enter your answer e.g., 32.16. b. What was the arithmetic average annual return on large-company stock Note: Do not round intermediate calculations and enter your answer e.g., 32.16. a. Nominal return b. Real return 12.70% 10.26 %

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

Problem 1PS

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Use the information in the following stock quote to answer the question: As of February 1, 2XX1 Name Symbol Open High Low Close Net Chg Div Yield PE Target TGT 87.01 87.32 86.75 87.05 -0.32 2.56 2.93 16.76 What was Target’s earnings per share over the last year? (Round your answer to 2 decimal places. (e.g., 32.16))
What is the expected return of Stock B given the information below about its returns across future states of nature? Enter return in decimal form, rounded to 4th digit, as in "0.1234"
How can I calculate geometric average in Excel?
What is Stock X's geometric returns if it has the following returns? Year 1 8% Year 2 - 5% Year 3 10% Year 4 - 6% Year 5 15% a. 4.1%. b. 5.2% c. 6.8% d. 8.5%
A stock has had the following year-end prices and dividends: Year 1 2355N 4 6 Price $ 64.63 71.50 77.30 63.57 73.71 82.75 Dividend Arithmetic average return Geometric average return $.66 .71 .77 .86 .93 What are the arithmetic and geometric returns for the stock? Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. % %
Consider the following annual returns of Molson Coors and International Paper: Molson Coors International Paper Year 1 19.3 % 5.1 % Year 2 − 9.0 −18.1 Year 3 39.5 −0.8 Year 4 − 8.1 27.2 Year 5 16.8 −11.7 Compute each stock’s average return, standard deviation, and coefficient of variation. (Round your answers to 2 decimal places.) Molson Coors International Paper Average return % % Standard deviation % % Coefficient of variation
Use the portion of the stock table shown below to answer the questions that follow. Round dollar amounts to the nearest cent, if necessary. YTD %CHG 52- HI Week LO STOCK DIV YLD % VOL 100s CLOSE NET CHG 2.8 37.43 21.10 A1 0.99 3.7 789 27.02 –0.1 2.4 48.30 30.78 B1 ... 1303 41.68 0.4 If you purchased 400 shares of B1 stock at $45.03, what would the loss be if the shares were sold at the closing price indicated in the table.
Consider the following information: Rate of Return if State Occurs State of Economy Probability of State of Economy Stock A Stock B Recession 21 .06 21 Normal 58 109 08 Boom 21 14 25 a. Calculate the expected return for Stocks A and B. (Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the standard deviation for Stocks A and B. (Do not round Intermedlate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) a. Stock A expected return a. Stock B expected return b. Stock A standard deviation b. Stock B standard deviation 196 96 96 %
Suppose a stock had an initial price of $84 per share, paid a dividend of $1.50 per share during the year, and had an ending share price of $71.50. a. Compute the percentage total return. (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. What was the dividend yield? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What was the capital gains yield? (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.)
Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock C splits two-for-one in the last period. A B C Po 82 42 84 Rate of return 00 100 Divisor 200 200 P1 87 37 94 01 100 200 200 % P2 87 Required: a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t = 0 to t= 1). (Do not round intermediate calculations. Round your answer to 2 decimal places.) 370 47 92 100 200 400 b. What will be the divisor for the price-weighted index in year 2? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. Calculate the rate of return of the price-weighted index for the second period (t=1 to t=2).
A stock has had returns of -19.1 percent, 29.1 percent, 25.2 percent, -10.2 percent, 34.9 percent, and 27.1 percent over the last six years. What are the arithmetic and geometric returns for the stock? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Arithmetic average return Geometric average return % %
Given the time series of historical stock returns below, what is the standard deviation? (Hint: theexpected return is 4%)Time Period 1 2 3 4 5return (%) 5% -7% 12% 13% -3% a. 7.585%b. 0.79%c. 8.888%d. 2.155%

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