Assume these are the stock market and Treasury bill returns for a 5-year period: ITT Stock Market T-Bill Return Year Return (%) (X) 2013 31.7 0.02 2014 10.9 0.02 2015 -1.6 0.02 2016 13.0 0. 20 2017 21.3 0.80 Required: a. What was the risk premium on common stock in each year? (Negative values should be entered with a negative sign.) b. What was the average risk premium? c. What was the standard deviation of the risk premium? (Ignore that the estimation is from a sample of data.) Complete this question by entering your answers in the tabs below. Required A Required B Required C What was the average risk premium? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 idecimal places.). Average risk premium < Required A Required C >
Assume these are the stock market and Treasury bill returns for a 5-year period: ITT Stock Market T-Bill Return Year Return (%) (X) 2013 31.7 0.02 2014 10.9 0.02 2015 -1.6 0.02 2016 13.0 0. 20 2017 21.3 0.80 Required: a. What was the risk premium on common stock in each year? (Negative values should be entered with a negative sign.) b. What was the average risk premium? c. What was the standard deviation of the risk premium? (Ignore that the estimation is from a sample of data.) Complete this question by entering your answers in the tabs below. Required A Required B Required C What was the average risk premium? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 idecimal places.). Average risk premium < Required A Required C >
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:Assume these are the stock market and Treasury bill returns for a 5-year period:
ITT
Stock Market T-Bill Return
Year
Return (%)
(X)
2013
31.7
0.02
2014
10.9
0.02
2015
-1.6
0.02
2016
13.0
0. 20
2017
21.3
0.80
Required:
a. What was the risk premium on common stock in each year? (Negative values should be entered with a negative sign.)
b. What was the average risk premium?
c. What was the standard deviation of the risk premium? (Ignore that the estimation is from a sample of data.)
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
What was the average risk premium? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2
idecimal places.).
Average risk premium
< Required A
Required C >
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