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Category > Business & Finance Posted 20 May 2017 My Price 12.00

Consider the following table for a period of six years.

Consider the following table for a period of six years.
  Returns
Year Large-Company Stocks U.S.
Treasury Bills
Year 1   Ac€?o 16.29 %   7.61 %
Year 2   Ac€?o 26.95     8.15  
Year 3     37.55     6.19  
Year 4     24.25     6.67  
Year 5   Ac€?o 7.80     5.61  
Year 6     6.89     8.12  
 
Requirement 1:

Calculate the arithmetic average returns for large-company stocks and T-bills over this time period. (Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).)
  Arithmetic average returns
  Large-company stock %      
  T-bills %      
 
Requirement 2:

Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period.(Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).)
  Standard deviation
  Large-company stock %      
  T-bills %      
 
Requirement 3:
Calculate the observed risk premium in each year for the large-company stocks versus the T-bills.
 
(a)

What was the arithmetic average risk premium over this period? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
  Risk premium %
(b)

What was the standard deviation of the risk premium over this period? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
  Risk premium standard deviation %

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Status NEW Posted 20 May 2017 10:05 AM My Price 12.00

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