Problem 12-16 Arithmetic and Geometric Returns [LO1] A stock has had the following year-end prices and dividends: Year Price Dividend $ 1 43.27 2 48.25 $.45 3 57.17 48 4 45.25 .60 5 52.17 .65 6 61.25 .73 What are the arithmetic and geometric average 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 9.56 % %

Problem 12-16 Arithmetic and Geometric Returns [LO1] A stock has had the following year-end prices and dividends: Year Price Dividend $ 1 43.27 2 48.25 $.45 3 57.17 48 4 45.25 .60 5 52.17 .65 6 61.25 .73 What are the arithmetic and geometric average 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 9.56 % %

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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Problem 10-20 Arithmetic and Geometric Returns A stock has had returns of 12 percent, 30 percent, 17 percent, −18 percent, 30 percent, and −7 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.)
Suppose your expectations regarding the stock price are as follows: State of the Market Boom Normal growth Recession Probability Ending Price 0.26 $ 140 0.25 110 0.49 80 Use the equations E (r) = Ep (s) r(s) and o² = Ep (s) [r(s) — E(r)]² to compute the mean and standard deviation of the HPR on - S S Mean Standard deviation HPR (including dividends) 55.0% 21.0 -16.0 stocks. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. % %
A stock has had the following year-end prices and dividends: Year 1234 in 10 5 6 Price $64.68 71.55 77.35 63.62 73.81 83.25 Dividend Arithmetic average return. Geometric average return $.67 .72 .78 .87 .94 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. % %
What is the reward-to-risk ratio for Stock X, in decimal form? Round your answer to 4 decimal places (example: if your answer is .03579, you should enter .0358). Margin of error for correct responses: +/- .0005. expected return (implied by market price) Beta Stock X 9.6% 1.46 S&P500 12% ? T-bills 4% ?
Problem 8-1Expected return A stock's returns have the following distribution: Demand for theCompany's Products Probability of ThisDemand Occurring Rate of Return IfThis Demand Occurs Weak 0.1 -30% Below average 0.1 -14 Average 0.3 11 Above average 0.3 20 Strong 0.2 45 1.0 Calculate the stock's expected return. Round your answer to two decimal places. Calculate the stock's standard deviation. Round your answer to two decimal places.% Calculate the stock's coefficient of variation. Round your answer to two decimal places. I'm struggling with the standard deviation and coefficient of deviation. Can you please post the formulas to calculate these in excel? Thank you!
Consider the rate of return of stocks ABC and XYZ. Year 1 2 3 4 ABC XYZ ABC 22% 9 19 1 O ABC Ⓒ XYZ ABC XYZ Required: a. Calculate the arithmetic average return on these stocks over the sample period. (Do not round Intermediate calculations. Round your answers to 2 decimal places.) XYZ 38% 11 19 -11 Arithmetic Average b. Which stock has greater dispersion around the mean return? c. Calculate the geometric average returns of each stock. (Do not round Intermediate calculations. Round your answers to 2 decimal places.) Expected rate of return 11.40 % 11.40 % Geometric Average Expected rate of return d. If you were equally likely to earn a return of 22%, 9%, 19%, 6%, or 1%, in each year (these are the five annual returns for stock ABC), what would be your expected rate of return? (Do not round Intermediate calculations. Round your answers to 2 decimal places.) e. What if the five possible outcomes were those of stock XYZ? (Do not round Intermediate calculations. Round your answers to 2…
Problem 9-19 Assume that the risk-free rate of interest is 6% and the expected rate of return on the market is 12%. A stock has an expected rate of return of 7%. What is its beta? (Negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.) Beta
#25 A stock has an expected return of 14.00%. The risk-free rate is 2.64% and the market risk premium is 7.99%. What is the β of the stock? Answer format: Number: Round to: 2 decimal places.
Question 4 Consider the following information on two stocks: Stock A Stock B P(State) 10% 25% -5% 15% -5% 10% 25% 8% 10% -5% 5% Boom Growth 20% Normal 30% 20% 20% Slow Bust Calculate the standard deviation of stock B. (Enter percentages as decimals and round to 4 decimals)
Problem 10-21 Arithmetic and Geometric Returns [LO 1] A stock has had the following year-end prices and dividends: Year Price Dividend $ 64.83 71.70 1 $ .70 3. 77.50 .75 4 63.77 .81 74.11 .90 84.75 .97 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 %
Q2 - Returns on stocks X and Y are listed below: Period 1 2 3 4 5 6 7Stock X 4% -2% 5% -1% 10% 7% 12%Stock Y -3% 7% 4% 2% 2% 8% -3% Consider a portfolio of 10% stock X and 90% stock Y. What is the mean of portfolio returns? Please specify your answer in decimal terms and round your answer to the nearest thousandth (e.g., enter 12.3 percent as 0.123).
Esc Chapter 12 Practice Problems 1. Suppose a stock had an initial price of $77 per share, paid a dividend of $1.35 per share during the year, and had an ending share price of $83. Compute the percentage total return. Q Search 1 Q A N @ 2 W S F2 X # 3 E F3 D $ 4 R F DII % 5 F5 T G * F6 A 6 Y B * H & 7 PrtScn U N * 8 Home 1 M 9 Page K End о F10 ) 0 PgUp F11 P

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