Question

You've observed the following returns on Crash-n-Burn Computer's stock over the past five years: 5 percent, -13 percent, 22 percent, 17 percent, and 13 percent. Requirement 1: What was the average return on Crash-n-Burn's stock over this five year period? (Click to select) Requirement 2: (a)What was the variance of Crash-n-Burn's returns over this period? (Do not round intermediate calculations.) (Click to select) ) (b)What was the standard deviation of Crash-n-Burn's returns over this period? (Do not round intermediate calculations.) Click to select)

Answer 1

YEAR	RETURN	(X -Average Return of X)^2
1	5	14.440000
2	-13	475.240000
3	22	174.240000
4	17	67.240000
5	13	17.640000
Total	44	748.800000
Average Return =	Total Return / NO of years
	44/5
	8.8
Variance =	sum of (X -Average Return of X)^2 / no of years
	748.80 / 5
	149.76
Standard Deviation =	Square root of Variance
	Square root of 149.76
	12.24