What is the geometric average rate of return earned

Assignment Help Accounting Basics
Reference no: EM131184604

The solution must be broken down to show all work to the answer in detail.

CANNOT BE IN EXCEL AND MUST IN WORD DOCUMENT SHOWING ALL WORK IN DETAIL INCLUDING THE FORMULA.

Caswell Enterprises had the following end-of-year stock prices over the last five years and paid no dividends.

Time   Caswell
1          $9
2          $14
3          $10
4          $7
5          $9

a. Calculate the average rate of return for each year from the above information.

b. What is the arithmetic average rate of return earned by investing in Caswell's stock over this period?

c. What is the geometric average rate of return earned by investing in Caswell's stock over this period?

d. Considering the beginning and ending stock prices for the five-year period are the same, which type of average rate of return best describes the annual rate of return earned over the period (arithmetic or geometric)?

e. The annual rate of return at the end of year 2 is what percent?

Reference no: EM131184604

Questions Cloud

How do results of parsing the following two sentences differ : Create a table named Inventory using the instructions and create a one-to-many relationship between SALES_REP and INVENTORY.
Compute the depreciation charge under straight-line methods : From the information given, compute the depreciation charge for 2015 under Straight-line methods. (Round to the nearest dollar.)
Report the dividend payments over the last three years : Report the dividend payments over the last three years. -Calculate the dividend payout and dividend yield. - Identify a dividend payout policy that the company follows.
Calculate the direction of motion of the particle : Calculate the direction of motion of the particle.
What is the geometric average rate of return earned : What is the arithmetic average rate of return earned by investing in Caswell's stock over this period? What is the geometric average rate of return earned by investing in Caswell's stock over this period?
Explain if any plan can assure no data loss to the public : Evaluate the role of the Informatics leader in overseeing clinical documentation and information systems during a disaster. Explain which is more important: risk assessment, risk management, or a business continuity plan to ensure data security an..
Write a program to calculate a persons net pay : Calculate a person's net pay after subtracting federal income tax. The program should ask the user to enter the person's name, social security number, gross pay, and the number of dependents.
Explain the role neuroplasticity would have in your recovery : Suppose you were to suffer an accident to the frontal lobe of your brain. Describe what effects you might notice as a result of this accident. Explain the role neuroplasticity would have in your recovery
Find the scaling factor of the original velocity vector : Find the scaling factor of the original velocity vector required to get the satellite to its new speed.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Engineering process changes for products

Cost of indirect materials, $160,000 Costs incurred to set up machines each time a different product needs to be manufactured, $365,000 Designing processes, drawing process charts, and making engineering process changes for products, $287,500

  Capwell corporation uses a periodic inventory system the

capwell corporation uses a periodic inventory system. the companys ending inventory on december 31 2013 its fiscal-year

  Evaluate the accounting principles used in canada

Evaluate the accounting principles used in Canada (name,description,examples of theuse). The balances below are shown in alphabetical order in a professional servicefirm'sledger at the end of a financialyear.

  Geox company produces and sells a specialized software

geox company produces and sells a specialized software package used by valuation analysts throughout the world. the

  Replaced by a unit penalty cost for shortages

Change the ordering simulation so that emergency orders are never made. Instead, assume that all excess demand is backlogged, so the emergency cost should be replaced by a unit penalty cost for shortages.

  What is fundamental problem with financial statements

What you think is the fundamental problem with financial statements based upon the historic cost measurement principle used under US GAAP  - What aspects of the requirements were used by US companies to defer recognition of a liability?

  Problem regarding the slate of candidates

Suppose that each person in a group of n people votes for exactly two people from a slate of candidates to fill two positions on a committee.The top two finishers both win positions as long as each receives more than n/2 votes.

  Given the following information determine the cost of goods

given the following information determine the cost of goods manufactured and the cost of goods sold for the year ended

  Chriss custom manufacturing company is considering three

chriss custom manufacturing company is considering three new projects each requiring an equipment investment of 24948.

  Explain the difference in the accounting treatment

Explain the difference in the accounting treatment of the cost of developed technology and the cost of in-process R&D in an acquisition.

  For apparel manufacturer abercrombie and fitch

For apparel manufacturer Abercrombie & Fitch, Inc., classify each of the following costs as either a product cost or a period cost:

  Significance of transaction to analyst

Explain the significance of this transaction to an analyst. Explain the consequences of poor quality reporting. What has the U.S. government done to improve the quality of reporting after recent financial scandals, such as Enron?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd