10. The annual returns on the stock of a firm during the last five years are providedbelow.YearReturn123450.08 (or 8%)0.10 (or 10%)0.15 (or 15%)0.20 (or 20%)-0.10 (or -10%)a) Find the holding period return of the stock over the five-year period.b) Compute the arithmetic average return of the stock over the five-year period.c) Calculate the geometric average return of the stock over the five-year period.d) Calculate the variance and standard deviation of the returns during this five-yearperiod. Use the arithmetic average return in (b) for your calculations in (d). Use atleast 5 decimal places for the variance computation to avoid rounding errors.

Holding period return is rate of return realized during the period of holding of stock.

Answered: Year Return 1 234 0.08 (or 8%) 0.10 (or…

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

See similar textbooks

Similar questions

Stephen has just purchased a home for $154,000. A mortgage company has approved his loan application for a 30-year fixed-rate loan at 4.75%. Stephen has agreed to pay 25% of the purchase price as a down payment. Find the down payment, amount of mortgage, and monthly payment. Click the icon to view the table of the monthly payment of principal and interest per $1,000 of the amount financed. The down payment is about S 38500 . (Round to the nearest cent as needed.) The mortgage amount is about $ (Round to the nearest cent as needed.)
Need A
Question 7: For the cash flows below, find the value of x that makes the equivalent annual worth in years 1 through 7 equal to $300 per year. Use an interest rate of 10% per year. Year 0 1 2 3 Answer: $619.88 Cash Flow,$ 200 200 200 200 Year 4 5 6 7 Cash Flow, $ X 200 200 200
Present Value $ 400 2,091 33,105 32,800 Years Interest Rate 12 % 10 % 15% 22 % Future Value $ 1,255 3,850 388,620 202,748
Stephen has just purchased a home for $136,000. A mortgage company has approved his loan application for a 30-year fixed-rate loan at 5.00%. Stephen has agreed to pay 30% of the purchase price as a down payment. Find the down payment, amount of mortgage, and monthly payment. Click the icon to view the table of the monthly payment of principal and interest per $1,000 of the amount financed. (Round to the nearest cent as needed.) (Round to the nearest cent as needed.) The down payment is about S The mortgage amount is about $ The monthly mortgage payment is about S CODE (Round to the nearest cent as needed.)
Solve using Rate of Return Method
S50 S50 S70 S90 SI10 S130 For the following cash flow, if the PP is semiannually and i= 12% per year compounded monthly, Find the present worth of the cash flow
plan A plan B plan C Down payment 1,789.91 2,309.65 3,764.51 Annual payments 5,097.70 7,450.16 9,845.78 Years 20 20 20 Discount rate 12% 12% 12% What is the present value of plan B?
What is the PV?
iR=25 R=4
Janine is 40 and has a good job at a biotechnology company. Janine estimates that she will need $953,000 in her total retirement nest egg by the time she is 65 in order to have retirement income of $25,500 a year. (She expects that Social Security will pay her an additional $18,500 a year.) She currently has $5,000 in an IRA, an important part of her retirement nest egg. She believes her IRA will grow at an annual rate of 8 percent, and she plans to leave it untouched until she retires at age 65. How much will Janine's IRA be worth when she needs to start withdrawing money from it when she retires? Use Exhibit 1-A. (Round time value factor to 3 decimal places and answer to 2 decimal places.) Future value of IRA
Complete the following using compound future value. (Use the Table provided.) Time 6 months Principal $ 15,000 Rate Compounded 6% Semiannually Amount Interest

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS

Year Return 1 234 0.08 (or 8%) 0.10 (or 10%) 0.15 (or 15%) 0.20 (or 20%) 0.10 10%)