Year Large-Company Stocks Long-Term Government Bonds U.S. Consumer Treasury Price Index Bills 1926 13.75% 5.69% 3.30% -1.12% |1927 35.70 6.58 3.15 -2.26 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 45.08 1.15 4.05 -1.16 -8.80 4.39 4.47 58 -25.13 4.47 2.27 -6.40 -43.60 -2.15 1.15 -9.32 -8.75 8.51 88 -10.27 52.95 1.92 52 76 -2.31 7.59 27 1.52 46.79 4.20 17 2.99 32.49 5.13 17 1.45 -35.45 1.44 27 2.86 31.63 4.21 .06 -2.78 -1.43 3.84 .04 .00 -10.36 5.70 .04 .71 -12.02 47 14 9.93 20.75 1.80 34 9.03 25.38 2.01 38 2.96 19.49 2.27 38 2.30 36.21 5.29 38 2.25 -8.42 54 38 18.13 5.05 -1.02 .62 8.84 4.99 2.66 1.06 2.99 17.81 4.58 112 -2.07 30.05 -98 1.22 5.93 23.79 -20 1.56 6.00 18.39 2.43 1.75 .75 -1.07 2.28 1.87 .75 52.23 3.08 .93 -.74 31.62 -.73 1.80 37 6.91 -1.72 2.66 2.99 -10.50 6.82 3.28 2.90 43.57 -1.72 171 1.76 12.01 -2.02 3.48 1.73 47 11.21 2.81 1.36 26.84 2.20 2.40 .67 -8.75 5.72 2.82 1.33 22.70 1.79 3.23 1.64 1964 1965 16.43 3.71 3.62 .97 12.38 93 4.06 1.92 1966 -10.06 5.12 4.94 3.46 1967 1968 1969 1970 23.98 -2.86 4.39 3.04 11.03 2.25 5.49 4.72 -8.43 -5.63 6.90 6.20 3.94 18.92 6.50 5.57 1971 1972 1973 14.30 11.24 4.36 3.27 18.99% 2.39% 4.23% 3.41% -14.69 3.30 7.29 8.71 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 -26.47 4.00 7.99 12.34 37.23 5.52 5.87 6.94 23.93 15.56 5.07 4.86 -7.16 38 5.45 6.70 6.57 -1.26 7.64 9.02 18.61 -2.76 10.56 13.29 32.50 -2.48 12.10 12.52 -4.92 4.04 14.60 8.92 21.55 44.28 10.94 3.83 22.56 1.29 8.99 3.79 6.27 15.29 9.90 3.95 31.73 32.27 7.71 3.80 18.67 22.39 6.09 1.10 5.25 -3.03 5.88 4.43 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 16.61 6.84 6.94 4.42 31.69 18.54 8.44 4.65 -3.10 7.74 7.69 6.11 30.46 19.36 5.43 3.06 7.62 7.34 3.48 2.90 10.08 13.06 3.03 2.75 1.32 -7.32 4.39 2.67 37.58 25.94 5.61 2.54 22.96 13 5.14 3.32 33.36 12.02 5.19 1.70 28.58 14.45 4.86 1.61 21.04 -7.51 4.80 2.68 2000 -9.10 17.22 5.98 3.39 |2001 2002 -11.89 5.51 3.33 1.55 -22.10 15.15 1.61 2.38 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 28.89 2.01 94 1.88 10.88 8.12 1.14 3.26 4.91 6.89 2.79 3.42 15.79 28 4.97 2.54 5.49 10.85 4.52 4.08 -37.00 41.78 124 .09 26.46 -25.61 15 2.72 15.06 7.73 14 1.50 2.11 35.75 .06 2.96 16.00 1.80 .08 1.74 32.39 -14.69 .05 1.50 13.69 24.74 .03 .75 1.41 -.64 .04 .74 11.98 1.76 21 2.11
Year Large-Company Stocks Long-Term Government Bonds U.S. Consumer Treasury Price Index Bills 1926 13.75% 5.69% 3.30% -1.12% |1927 35.70 6.58 3.15 -2.26 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 45.08 1.15 4.05 -1.16 -8.80 4.39 4.47 58 -25.13 4.47 2.27 -6.40 -43.60 -2.15 1.15 -9.32 -8.75 8.51 88 -10.27 52.95 1.92 52 76 -2.31 7.59 27 1.52 46.79 4.20 17 2.99 32.49 5.13 17 1.45 -35.45 1.44 27 2.86 31.63 4.21 .06 -2.78 -1.43 3.84 .04 .00 -10.36 5.70 .04 .71 -12.02 47 14 9.93 20.75 1.80 34 9.03 25.38 2.01 38 2.96 19.49 2.27 38 2.30 36.21 5.29 38 2.25 -8.42 54 38 18.13 5.05 -1.02 .62 8.84 4.99 2.66 1.06 2.99 17.81 4.58 112 -2.07 30.05 -98 1.22 5.93 23.79 -20 1.56 6.00 18.39 2.43 1.75 .75 -1.07 2.28 1.87 .75 52.23 3.08 .93 -.74 31.62 -.73 1.80 37 6.91 -1.72 2.66 2.99 -10.50 6.82 3.28 2.90 43.57 -1.72 171 1.76 12.01 -2.02 3.48 1.73 47 11.21 2.81 1.36 26.84 2.20 2.40 .67 -8.75 5.72 2.82 1.33 22.70 1.79 3.23 1.64 1964 1965 16.43 3.71 3.62 .97 12.38 93 4.06 1.92 1966 -10.06 5.12 4.94 3.46 1967 1968 1969 1970 23.98 -2.86 4.39 3.04 11.03 2.25 5.49 4.72 -8.43 -5.63 6.90 6.20 3.94 18.92 6.50 5.57 1971 1972 1973 14.30 11.24 4.36 3.27 18.99% 2.39% 4.23% 3.41% -14.69 3.30 7.29 8.71 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 -26.47 4.00 7.99 12.34 37.23 5.52 5.87 6.94 23.93 15.56 5.07 4.86 -7.16 38 5.45 6.70 6.57 -1.26 7.64 9.02 18.61 -2.76 10.56 13.29 32.50 -2.48 12.10 12.52 -4.92 4.04 14.60 8.92 21.55 44.28 10.94 3.83 22.56 1.29 8.99 3.79 6.27 15.29 9.90 3.95 31.73 32.27 7.71 3.80 18.67 22.39 6.09 1.10 5.25 -3.03 5.88 4.43 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 16.61 6.84 6.94 4.42 31.69 18.54 8.44 4.65 -3.10 7.74 7.69 6.11 30.46 19.36 5.43 3.06 7.62 7.34 3.48 2.90 10.08 13.06 3.03 2.75 1.32 -7.32 4.39 2.67 37.58 25.94 5.61 2.54 22.96 13 5.14 3.32 33.36 12.02 5.19 1.70 28.58 14.45 4.86 1.61 21.04 -7.51 4.80 2.68 2000 -9.10 17.22 5.98 3.39 |2001 2002 -11.89 5.51 3.33 1.55 -22.10 15.15 1.61 2.38 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 28.89 2.01 94 1.88 10.88 8.12 1.14 3.26 4.91 6.89 2.79 3.42 15.79 28 4.97 2.54 5.49 10.85 4.52 4.08 -37.00 41.78 124 .09 26.46 -25.61 15 2.72 15.06 7.73 14 1.50 2.11 35.75 .06 2.96 16.00 1.80 .08 1.74 32.39 -14.69 .05 1.50 13.69 24.74 .03 .75 1.41 -.64 .04 .74 11.98 1.76 21 2.11
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
Related questions
Question
100%
Based on Table 12.1 on page 392 answer the following questions:
A. Which were the three worst years for Large-Company stocks? What economic event was happening when the stock market was doing so poorly?
B. What were the best years for U.S. Treasury bills? What was happening in the economy that caused them to do so well?
C. When stocks go down, how do long-term government bonds typically do? Provide at least two years of data that support your position.
Transcribed Image Text:Year Large-Company
Stocks
Long-Term
Government Bonds
U.S.
Consumer
Treasury
Price Index
Bills
1926
13.75%
5.69%
3.30%
-1.12%
|1927
35.70
6.58
3.15
-2.26
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
45.08
1.15
4.05
-1.16
-8.80
4.39
4.47
58
-25.13
4.47
2.27
-6.40
-43.60
-2.15
1.15
-9.32
-8.75
8.51
88
-10.27
52.95
1.92
52
76
-2.31
7.59
27
1.52
46.79
4.20
17
2.99
32.49
5.13
17
1.45
-35.45
1.44
27
2.86
31.63
4.21
.06
-2.78
-1.43
3.84
.04
.00
-10.36
5.70
.04
.71
-12.02
47
14
9.93
20.75
1.80
34
9.03
25.38
2.01
38
2.96
19.49
2.27
38
2.30
36.21
5.29
38
2.25
-8.42
54
38
18.13
5.05
-1.02
.62
8.84
4.99
2.66
1.06
2.99
17.81
4.58
112
-2.07
30.05
-98
1.22
5.93
23.79
-20
1.56
6.00
18.39
2.43
1.75
.75
-1.07
2.28
1.87
.75
52.23
3.08
.93
-.74
31.62
-.73
1.80
37
6.91
-1.72
2.66
2.99
-10.50
6.82
3.28
2.90
43.57
-1.72
171
1.76
12.01
-2.02
3.48
1.73
47
11.21
2.81
1.36
26.84
2.20
2.40
.67
-8.75
5.72
2.82
1.33
22.70
1.79
3.23
1.64
1964
1965
16.43
3.71
3.62
.97
12.38
93
4.06
1.92
1966
-10.06
5.12
4.94
3.46
1967
1968
1969
1970
23.98
-2.86
4.39
3.04
11.03
2.25
5.49
4.72
-8.43
-5.63
6.90
6.20
3.94
18.92
6.50
5.57
Transcribed Image Text:1971
1972
1973
14.30
11.24
4.36
3.27
18.99%
2.39%
4.23%
3.41%
-14.69
3.30
7.29
8.71
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
-26.47
4.00
7.99
12.34
37.23
5.52
5.87
6.94
23.93
15.56
5.07
4.86
-7.16
38
5.45
6.70
6.57
-1.26
7.64
9.02
18.61
-2.76
10.56
13.29
32.50
-2.48
12.10
12.52
-4.92
4.04
14.60
8.92
21.55
44.28
10.94
3.83
22.56
1.29
8.99
3.79
6.27
15.29
9.90
3.95
31.73
32.27
7.71
3.80
18.67
22.39
6.09
1.10
5.25
-3.03
5.88
4.43
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
16.61
6.84
6.94
4.42
31.69
18.54
8.44
4.65
-3.10
7.74
7.69
6.11
30.46
19.36
5.43
3.06
7.62
7.34
3.48
2.90
10.08
13.06
3.03
2.75
1.32
-7.32
4.39
2.67
37.58
25.94
5.61
2.54
22.96
13
5.14
3.32
33.36
12.02
5.19
1.70
28.58
14.45
4.86
1.61
21.04
-7.51
4.80
2.68
2000
-9.10
17.22
5.98
3.39
|2001
2002
-11.89
5.51
3.33
1.55
-22.10
15.15
1.61
2.38
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
28.89
2.01
94
1.88
10.88
8.12
1.14
3.26
4.91
6.89
2.79
3.42
15.79
28
4.97
2.54
5.49
10.85
4.52
4.08
-37.00
41.78
124
.09
26.46
-25.61
15
2.72
15.06
7.73
14
1.50
2.11
35.75
.06
2.96
16.00
1.80
.08
1.74
32.39
-14.69
.05
1.50
13.69
24.74
.03
.75
1.41
-.64
.04
.74
11.98
1.76
21
2.11
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