A peculiar stock has alternated between earning a 5% rate of return and a -1.9% rate...
A peculiar stock has alternated between earning a 5% rate of return and a -1.9% rate of return (loss) each year for 10 years total (half each). What was the total rate of return over these 10 years?
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A peculiar stock has alternated between earning a 5% rate of return and a -1.9% rate...
Your investment has a 40% chance of earning a 18% rate of return, a 50% chance...
Your investment has a 40% chance of earning a 18% rate of return, a 50% chance of earning a 9% rate of return, and a 10% chance of losing 23%. What is the standard deviation of this investment? between 8% and 16% Between zero and 8% between -18% and zero greater than 16%
AA Corporation’s stock has a beta of 1.9. The risk-free rate is 4.5% and the expected...
AA Corporation’s stock has a beta of 1.9. The risk-free rate is 4.5% and the expected return on the market is 12%. What is the required rate of return on AA's stock? Round your answer to two decimal places.
solve question 5&6 5. Calculating Average Returns The rate of return on Cherry Jalopies, Inc., stock...
solve question 5&6
5. Calculating Average Returns The rate of return on Cherry Jalopies, Inc., stock over the last five years was 7 percent, 21 percent, - 8 percent, - 5 percent, and 31 percent. Over the same period, the return on Straw Construction Company's stock was 12 percent, 34 percent, - 11 percent, -7 percent, and 41 percent. What was the arithmetic average return on each stock over this period? 6. Calculating Returns and Variability Using the following returns,...
Q1) A stock fund has an expected return of 15% and a standard deviation of 25%...
Q1) A stock fund has an expected return of 15% and a standard deviation of 25% and a bond fund has an expected return of 10% and a standard deviation of 10%. The correlation between the two funds is 0.25. The risk free rate is 5%. What is the (a) expected return and (b) standard deviation of the portfolio with 70% weight in the stock portfolio and 30% weight in the bond portfolio? Q2) The variance of Stock A is...
Stock ABC has a required return of 9 percent. Stock XYZ has a required return of...
Stock ABC has a required return of 9 percent. Stock XYZ has a required return of 11 percent. Assume a risk-free rate of 2.75 percent. As a result, Stock ABC is riskier than Stock XYZ. True False PQR, Inc. recently adjusted the probabilities for its expected cash flows due to a change in market conditions. It revised the probability of favorable conditions from 42% to 18% and the probability of poor earnings from 5% to 20%. It is likely that...
If you deposit $2,800 today into an account earning an annual rate of return of 8...
If you deposit $2,800 today into an account earning an annual rate of return of 8 percent, what would your account be worth in 35 years (assuming no further deposits)? In 40 years? a. If you deposit $2,800 today into an account earning an annual rate of return of 8 percent, what would your account be worth in 35 years? __________________ (Round to the nearest cent.) b. If you deposit $2,800 today into an account earning an annual rate of...
An investment has a 25% probability of earning an 8% return, and a 75% chance of...
An investment has a 25% probability of earning an 8% return, and a 75% chance of earning a 10% return. What is this investment's average expected rate of return? Multiple Choice 10% 95% 9.0% 8.0%
A stock has an expected rate of return of 9.8 percent and a standard deviation of...
A stock has an expected rate of return of 9.8 percent and a standard deviation of 15.4 percent. Which one of the following best describes the probability that this stock will lose at least half of its value in any one given year? O A. between 0.025 and 0.16 O B. less than 0.005 O C. between 0.005 and 0.025 O D.greater than 0.10
The common stock of Flavorful Teas has a beta of 48. The risk-free rate of return...
The common stock of Flavorful Teas has a beta of 48. The risk-free rate of return is 2.5 percent. The return on the market is 12 percent and. What is the expected return on this stock? If the Market risk premium is 8.5%, what is the expected return on this stock? ABC Corp just paid a dividend of $1.5 per share. The dividend is expected to grow at 4% a year indefinitely. If the required rate of return is 8.5%,...
(Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle...
(Calculating the geometric and arithmetic average rate of return) 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 $15 11 24 28 a. Calculate the annual rate of return for each year 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...
solve question 5&6
5. Calculating Average Returns The rate of return on Cherry Jalopies, Inc., stock over the last five years was 7 percent, 21 percent, - 8 percent, - 5 percent, and 31 percent. Over the same period, the return on Straw Construction Company's stock was 12 percent, 34 percent, - 11 percent, -7 percent, and 41 percent. What was the arithmetic average return on each stock over this period? 6. Calculating Returns and Variability Using the following returns,...
An investment has a 25% probability of earning an 8% return, and a 75% chance of earning a 10% return. What is this investment's average expected rate of return? Multiple Choice 10% 95% 9.0% 8.0%
A stock has an expected rate of return of 9.8 percent and a standard deviation of 15.4 percent. Which one of the following best describes the probability that this stock will lose at least half of its value in any one given year? O A. between 0.025 and 0.16 O B. less than 0.005 O C. between 0.005 and 0.025 O D.greater than 0.10
(Calculating the geometric and arithmetic average rate of return) 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 $15 11 24 28 a. Calculate the annual rate of return for each year 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...
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