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Question
In: Finance
(Expected return and risk) The following data represend returns for the common stocks over a one-year period.
(Expected return and risk) The following data represend returns for the common stocks over a one-year period.
The mean (expected) return of Google is _______%. (Keep the sign and two decimal numbers.)
Solutions
Expert Solution
Mean expected return of Google -
P1*ER1+ P2*ER2+...Pn*ERn
Probability - P
Expected return - ER
= (0.1 *-0.2)+(0.2*0.08)+(0.2*0.34)+(0.3*-0.18)+(0.2*0.04)
=-0.02+0.016+0.068-0.054+0.008
=0.058 =5.8%
Mean expected return for Google is 5.8%
Mean expected return for Google is 5.8%
Junaid answered 2 years agoRelated Solutions
The following information indicates percentage returns for stocks L and M over a 6-year period: year...
The following information indicates percentage returns for
stocks L and M over a 6-year period:
year
stock L returns
stock M returns
1
14.79%
20.57%
2
14.3%
18.19%
3
16.47%
16.2%
4
17.86%
14.43%
5
17.6%
12.53%
6
19.39%
10.98%
In combining [L−M] in a single portfolio, stock M would receive
60% of capital funds. Furthermore, the information below reflects
percentage returns for assets F, G, and H over a 4-year period,
with asset F being the base instrument: Year...
The following information indicates percentage returns for stocks L and M over a 6-year period: Year...
The following information indicates percentage returns for
stocks L and M over a 6-year period:
Year
Stock L Returns
Stock M Returns
1
14.02%
20.19%
2
14.59%
18.23%
3
16.99%
16.41%
4
17.29%
14.41%
5
17.5%
12.43%
6
19.27%
10.41%
In combining [L−M] in a single portfolio,
stock M would receive 60% of capital funds.
Furthermore, the information below reflects percentage returns
for assets F, G, and H over a 4-year
period, with asset F being the base instrument:
Year...
The following information indicates percentage returns for stocks L and M over a 6-year period: Year...
The following information indicates percentage returns for
stocks L and M over a 6-year period:
Year
Stock L Returns
Stock M Returns
1
14.13%
20.87%
2
14.88%
18.83%
3
16.06%
16.49%
4
17.38%
14.46%
5
17.7%
12.51%
6
19.27%
10.04%
In combining [L−M] in a single portfolio,
stock M would receive 60% of capital funds.
Furthermore, the information below reflects percentage returns
for assets F, G, and H over a 4-year
period, with asset F being the base instrument:
Year...
The following information indicates percentage returns for stocks L and M over a 6-year period: Year...
The following information indicates percentage returns for
stocks L and M over a 6-year period:
Year
Stock L Returns
Stock M Returns
1
14.65%
20.28%
2
14.27%
18.83%
3
16.87%
16.47%
4
17.61%
14.61%
5
18%
12.37%
6
19.84%
10.64%
In combining [L−M] in a single portfolio,
stock M would receive 60% of capital funds.
Furthermore, the information below reflects percentage returns
for assets F, G, and H over a 4-year
period, with asset F being the base instrument:
Year...
The following information indicates percentage returns for stocks L and M over a 6-year period: Year...
The following information indicates percentage returns for
stocks L and M over a 6-year period:
Year
Stock L Returns
Stock M Returns
1
14.02%
20.19%
2
14.59%
18.23%
3
16.99%
16.41%
4
17.29%
14.41%
5
17.5%
12.43%
6
19.27%
10.41%
In combining [L−M] in a single portfolio,
stock M would receive 60% of capital funds.
Furthermore, the information below reflects percentage returns
for assets F, G, and H over a 4-year
period, with asset F being the base instrument:
Year...
he following information indicates percentage returns for stocks L and M over a 6-year period: Year...
he following information indicates percentage returns for stocks
L and M over a 6-year period:
Year
Stock L Returns
Stock M Returns
1
14.79%
20.57%
2
14.3%
18.19%
3
16.47%
16.2%
4
17.86%
14.43%
5
17.6%
12.53%
6
19.39%
10.98%
In combining [L−M] in a single portfolio,
stock M would receive 60% of capital funds.
Furthermore, the information below reflects percentage returns
for assets F, G, and H over a 4-year
period, with asset F being the base instrument:
Year...
Suppose we have the following returns for large-company stocks and Treasury bills over a six-year period:...
Suppose we have the following returns for large-company stocks
and Treasury bills over a six-year period:
Year. Large Company. US Treasury Bill
1. 3.99%. 6.65%
2. 14.50. 4.46
3 19.39 4.33
4 -14.29 7.34
5 -31.78 5.44
6 37.10 6.45
a. Calculate the arithmetic average returns for large-company
stocks and T-bills over this period.
b. Calculate the standard deviation of the returns for
large-company stocks and T-bills over this period.
c-1. Calculate the observed risk premium in each year...
Suppose we have the following returns for large-company stocks and Treasury bills over a six-year period:...
Suppose we have the following returns for large-company stocks
and Treasury bills over a six-year period: Year Large Company US
Treasury Bill 1 3.66% 4.66% 2 14.44 2.33 3 19.03 4.12 4 –14.65 5.88
5 –32.14 4.90 6 37.27 6.33 a. Calculate the arithmetic average
returns for large-company stocks and T-bills over this period. (Do
not round intermediate calculations and enter your answers as a
percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the
standard deviation of the...
Suppose we have the following returns for large-company stocks and Treasury bills over a six-year period:...
Suppose we have the following returns for large-company stocks
and Treasury bills over a six-year period:
Year
Large Company
US Treasury Bill
1
3.69%
4.75%
2
14.48
3.59
3
19.27
4.18
4
–14.41
5.91
5
–31.90
5.32
6
37.51
6.41
a.
Calculate the arithmetic average returns for large-company
stocks and T-bills over this period. (Do not round
intermediate calculations and enter your answers as a percent
rounded to 2 decimal places, e.g., 32.16.)
b.
Calculate the standard deviation of the...
Suppose we have the following returns for large-company stocks and Treasury bills over a six-year period:...
Suppose we have the following returns for large-company stocks
and Treasury bills over a six-year period:
Year
Large Company
US Treasury Bill
1
3.66%
4.66%
2
14.44
2.33
3
19.03
4.12
4
–14.65
5.88
5
–32.14
4.90
6
37.27
6.33
a.
Calculate the arithmetic average returns for large-company
stocks and T-bills over this period. (Do not round
intermediate calculations and enter your answers as a percent
rounded to 2 decimal places, e.g., 32.16.)
b.
Calculate the standard deviation of the...
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