Compute discrepancy between arithmetic and geometric rates

Assignment Help Financial Management
Reference no: EM131235093

1. Using the information in given Table, compute the discrepancy between arithmetic and geometric rates of return for cash and stocks. Which one is lower? Why?

2. Broadly speaking, what was the average rate of return on cash, bonds, and stocks? What time period are your numbers from?

536_Table 1.jpg

Reference no: EM131235093

Questions Cloud

How do shares disappear from the stock exchange : What are the institutional mechanisms by which funds disappear from the public financial markets back into the pockets of investors?
Name and describe five advantages of low setup time : Why is process flexibility desirable? What two conditions are required?
Did you have any sense of resolution : Did you have any sense of resolution? Was it enough to satisfy you? Why do you think the playwright chose to end the play without revealing the truth?
Formulate a hypothesis for a chi-square test : A researcher plans to ask employees whether they favor, oppose, or are indifferent about a change in the company retirement program. Formulate a hypothesis for a chi-square test and the way the variable would be created
Compute discrepancy between arithmetic and geometric rates : Compute the discrepancy between arithmetic and geometric rates of return for cash and stocks. Which one is lower? Why?
Additional assessment on technical management and sla : Child Protection board has considered your assessment of the risk management and security issues for the data file exchange and payroll services proposed. They have decided that they need an additional assessment on the technical management and th..
Why is employee involvement important in a jit environment : Why would a JIT manufacturer schedule seven hours of work in an eight-hour shift?
Compare and contrast the promotional strategies : Compare and contrast the promotional strategies used by two (2) different companies for a similar product within the category that you selected
Danger in assumption that more information is always better : Information as having some characteristics that are not mentioned for the other five supply chain drivers. Information is "a key driver than can be used to provide higher responsiveness while simultaneously improving efficiency." On the other hand, "..

Reviews

Write a Review

Financial Management Questions & Answers

  Compute earnings per share for the year

Carpets R Us had earnings after taxes of $800,000 in the year 2014 with 200,000 shares of stock outstanding. On January 1, 2015, the firm issued 50,000 new shares. Because of the proceeds from these new shares and other operating improvements, earnin..

  What was the most recent dividend per share paid on stock

Secolo Corporation stock currently sells for $68 per share. The market requires a return of 11 percent on the firm's stock. If the company maintains a constant 3.75 percent growth rate in dividends, what was the most recent dividend per share paid on..

  What is the value of gold coasts stock

Gold Coast Health System just paid an annual dividend of $1.50, which is expected to grow at a constant rate of 5 percent per year. If the current required rate of return is 15 percent, what is the value of Gold Coast's stock?

  What is important determinant of meeting retirement goals

Most state lotteries in the U.S. give Lottery winners of particularly large prizes the option of taking the total prize as an annuity over several years, usually 10-20, or as a discounted lump sum now. What does this relationship suggest to potential..

  What is cost of common equity capital

You know that the return of Momentum Cyclicals common shares is 1.6 times as sensitive to macroeconomic information as the return of the market. If the risk-free rate of return is 2.45 percent and market risk premium is 5.71 percent, what is Momentum..

  What reasons why delta air lines extended lives of flight eq

What are some of the possible reasons why Delta Air Lines may have extended the lives of flight equipment and changed the residual values for depreciation purposes four times since 1986?

  Capital balance after closing income summary to capital

Deng and Dang are partners who share income in the ratio of 3:2. Their capital balances are $48,122 and $62,776 respectively. Income Summary has a credit balance of $44,798. What is Deng's capital balance after closing Income Summary to Capital?

  Medical insurance for your family

You have medical insurance for your family with a $250 deductible, 20% coinsurance, and $1,500 OOP maximum for each individual and $3,000 family OOP maximum. Calculate your OOP costs if you incur $6,000 in medical costs.

  Financial press reports the USD-NGN exchange rate

The financial press reports the USD/NGN exchange rate at 194.0521 and the USD/NZD exchange rate at 1.5043. What is the cross rate between the New Zealand dollar and the Nigerian naira?

  Calculate the operating cash flows of the project

Laurel’s Lawn Care, Ltd., has a new mower line that can generate revenues of $153,000 per year. Direct production costs are $51,000, and the fixed costs of maintaining the lawn mower factory are $20,500 a year. Calculate the operating cash flows of t..

  Make a single investment now instead of spending

If a company wanted to make a single investment now instead of spending $25,000 five years from now, how much would the investment be at an interest rate of 12% compounded per year? Calculate nearest to value.

  The semi-annual coupon payments for this bond

Apps store, Inc is offering a 7 year bond with a 1000 par value. The selling price is 95% of the par value and the bond offers a yield to maturity of 10%. This bond offers semi-annual coupon payments? What is the dollar amount $ of the semi-annual co..

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