What is the risk premium of owing hacker corporations stock

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You’ve observed the following returns on Hacker Corporation’s stock over the past five years: -25%, 36%, 9%, 11%, and 17%. Answer the following questions.

Suppose the current T-bill rate is 0.15%. What is the risk premium of owing Hacker Corporation s stock?

a. 11.10%

b. 9.75%

c. 8.10%

d. 9.45%

What range of returns would you expect to see 95% of the time?

a. -34.57% to 53.77%

b. -56.66% to 75.86%

c. -12.49% to 31.69%

d. 9.6% to 22.09%

According to the Blume's formula, what is the 2-year average return forecast?

a. 8.57%

b. 7.62%

c. 9.11%

d. 9.60%

Reference no: EM13875109

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