### Calculate the arithmetic average rate of return

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Question: You need to complete this problem in a spreadsheet and show all your work. Create an excel file that shows your calculations. Clearly indicate your final answer(s). Name the file with the following convention: Lastname-Problem#.xlsx. For instance, Roark-Problem1.xlsx.

Assume that you purchased stock in Buffalo Wildlings Inc for \$26 per share. The following chart shows your dividends and the end of year price for each of the past six years:

 Year Dividends Ending Price 1 \$0.80 \$27.50 2 \$0.84 \$32.50 3 \$0.88 \$29.34 4 \$0.94 \$28.12 5 \$1.02 \$36.05 6 \$1.08 \$29.95

a) Calculate the dividend yield, the capital gains yield and the total return for each year.

b) Calculate the arithmetic average rate of return for the 6 year period.

c) Calculate the geometric average rate of return for the 6 year period.

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