Question

Consider the following table for a period of six years: Returns Large- Company Stocks U.S Treasury Bills Year 1 -15.29% 7.41% 2 -26.65 8.05 3 37.35 24.05 5.99 4 5.67 5 7.40 5.51 6 6.69 7.82 a-1. Calculate the arithmetic average returns for large-company stocks and T-bills over this time period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) a-2. Calculate the standard deviation of the returns for large-company stocks and T-bills over this time period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Need help with b1 and b2 please explain with details.Thx

Answer 1

Year	Large comp stock (A)	T bill (B)	Risk premium = A-B
1	-15.29	7.41	-22.7
2	-26.65	8.05	-34.7
3	37.35	5.99	31.36
4	24.05	5.67	18.38
5	-7.4	5.51	-12.91
6	6.69	7.82	-1.13

Year	Risk premium
1	-22.70%
2	-34.70%
3	31.36%
4	18.38%
5	-12.91%
B-1) Average=	-4.11%
B-2) Standard dev=	27.94%

Where
Average or Mean = Sum of all observations/Count of all observations
Sample Standard deviation =((∑k=1 to N (observationk – average))/(N-1))^(1/2)