XYZ stock price and dividend history are as follows: Year Beginning-of-Year Price Dividend Paid at Year- End 2007 $170 $5 2008 $ 180 $5 2009 $160 $5 2010 $ 165 $5 An investor buys 3 shares of XYZ at the beginning of 2007, buys another 2 shares at the beginning of 2008, sells 1 share at the beginning of 2009, and sells all 4 remaining shares at the beginning of 2010. Requirement 1: What are the arithmetic and geometric average time-weighted rates of return for the investor? (Round your answers to 2 decimal places. Omit the "%" sign in your response.) Arithmetic mean Geometric mean 2.24 % %
XYZ stock price and dividend history are as follows: Year Beginning-of-Year Price Dividend Paid at Year- End 2007 $170 $5 2008 $ 180 $5 2009 $160 $5 2010 $ 165 $5 An investor buys 3 shares of XYZ at the beginning of 2007, buys another 2 shares at the beginning of 2008, sells 1 share at the beginning of 2009, and sells all 4 remaining shares at the beginning of 2010. Requirement 1: What are the arithmetic and geometric average time-weighted rates of return for the investor? (Round your answers to 2 decimal places. Omit the "%" sign in your response.) Arithmetic mean Geometric mean 2.24 % %
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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Transcribed Image Text:XYZ stock price and dividend history are as follows:
Year Beginning-of-Year Price
Dividend Paid at Year-
End
2007
$170
$5
2008
$180
$5
2009
$160
$5
2010
$165
$5
An investor buys 3 shares of XYZ at the beginning of 2007, buys another 2 shares at the
beginning of 2008, sells 1 share at the beginning of 2009, and sells all 4 remaining
shares at the beginning of 2010.
Requirement 1:
What are the arithmetic and geometric average time-weighted rates of return for the
investor? (Round your answers to 2 decimal places. Omit the "%" sign in your
response.)
Arithmetic mean
Geometric mean
2.24 %
%
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