Question

In: Finance

Consider a sample of year-end prices for Alphabet, Inc. (Google) over a five year period. Google...

Consider a sample of year-end prices for Alphabet, Inc. (Google) over a five year period. Google did not pay a dividend over the sample period.

YEAR PRICE
2012 $576.93
2011 $603.31
2010 $531.56
2009 $343.14
2008 $560.72
2007 $501.69

Calculate the average (arithmetic) return.

Calculate the holding period return.

Calculate the geometric return.

Calculate the standard deviation in the returns.

Solutions

Expert Solution


Related Solutions

Consider the performance of two securities, J and K over the five year period from 2000...
Consider the performance of two securities, J and K over the five year period from 2000 to 2004. The annual return earned on each one of them is as provided in the table below: Year J K % % 2000 -30.0 6.4 2001 55.9 -21.1 2002 15.7 -10.0 2003 75.9 35.0 2004 5.7 15.6 Required: Compute the following: The appropriate annual average return for both securities over the 5-year holding period; assuming re-investment of all returns for respective years. [05...
The prices of Rawlston, Inc. stock (y) over a period of 12 days, the number of...
The prices of Rawlston, Inc. stock (y) over a period of 12 days, the number of shares (in 100s) of company's stocks sold (x1), the volume of exchange (in millions) on the New York Stock Exchange (x2), and the daily profit of the company (in thousands) (x3) are shown below. day y x1 x2 x3 1 87.50 950 11.00 40 2 86.00 945 11.25 45 3 84.00 940 11.75 27 4 78.00 930 11.75 22 5 84.50 935 12.00 34...
Google stock rose from $208 at year-end 2005 to $770 per share at year-end 2015. Google...
Google stock rose from $208 at year-end 2005 to $770 per share at year-end 2015. Google has made sizable profits but never paid a dividend. Why were people willing to pay such a high price knowing that they might not get dividends for many years?
The following are closing prices of Google stock for a sample of trading days. Use the...
The following are closing prices of Google stock for a sample of trading days. Use the 1-Var Stats command in the TI-84 PLUS calculator to compute the sample standard deviation. 455.21 , 482.37, 483.19, 459.63, 497.99, 475.10, 472.08, 444.95, 489.22 Write only a number as your answer. Round to two decimal places (for example 8.32). Your Answer:
Consider the following five monthly returns. The arithmetic average monthly return over this period is 3.40​%...
Consider the following five monthly returns. The arithmetic average monthly return over this period is 3.40​% and the geometric average monthly return over this period is 3.30​%. Explain the difference between the arithmetic average return and the geometric average return. Are both numbers​ useful? If​ so, explain​ why? 6​% negative 3​% 7​% 8​% negative 1​% Choose the correct answer below. A. The arithmetic average return is the best estimate of what you would earn in the​ future, so this is...
Over a five-year period, the quarterly change in the price per share of common stock for...
Over a five-year period, the quarterly change in the price per share of common stock for a major oil company ranged from -8% to 12%. A financial analyst wants to learn what can be expected for price appreciation of this stock over the next two years. Using the fiveyear history as a basis, the analyst is willing to assume that the change in price for each quarter is uniformly distributed between -8% and 12%. Use simulation to provide information about...
Over a five-year period, the quarterly change in the price per share of common stock for...
Over a five-year period, the quarterly change in the price per share of common stock for a major oil company ranged from -7% to 14%. A financial analyst wants to learn what can be expected for price appreciation of this stock over the next two years. Using the five-year history as a basis, the analyst is willing to assume that the change in price for each quarter is uniformly distributed between -7% and 14%. Use simulation to provide information about...
Over a five-year period, the quarterly change in the price per share of common stock for...
Over a five-year period, the quarterly change in the price per share of common stock for a major oil company ranged from -6% to 10%. A financial analyst wants to learn what can be expected for price appreciation of this stock over the next two years. Using the five-year history as a basis, the analyst is willing to assume that the change in price for each quarter is uniformly distributed between -6% and 10%. Use simulation to provide information about...
You get a $13,000 loan over a five-year period at 10% per year interest. The payments...
You get a $13,000 loan over a five-year period at 10% per year interest. The payments are to be made monthly. What is the unrecovered balance immediately after the first payment has been made?
The common stock of the Brangus Cattle Company had the following​ end-of-year stock prices over the...
The common stock of the Brangus Cattle Company had the following​ end-of-year stock prices over the last five years and paid no cash​ dividends: Time Brangus cattle Comapny 1 ​$13 2 10 3 14 4 20 5 27 a.  Calculate the annual rate of return for EACH YEARr from the above information. b.  What is the arithmetic average rate of return earned by investing in Brangus Cattle​ Company's stock over this​ period? c.  What is the geometric average rate of...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT