What was the arithmetic average annual return

Assignment Help Financial Management
Reference no: EM13919399

Consider the following information on large-company stocks for a period of years. Series Arithmetic Mean Large-company stocks 13.1 % Small-company stocks 16.4 Long-term corporate bonds 6.2 Long-term government bonds 6.1 Intermediate-term government bonds 5.6 U.S. Treasury bills 3.8 Inflation 3.6 Required: (a) What was the arithmetic average annual return on large-company stocks in nominal terms? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Nominal return % (b) What was the arithmetic average annual return on large-company stocks in real terms? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Reference no: EM13919399

Questions Cloud

What is the probability that the sample mean scores : A typical adult has an average IQ score of 105 with a standard deviation of 20. If 20 randomly selected adults are given an IQ test, what is the probability that the sample mean scores will be between 85 and 125 points?
Develop a linear program that phototech can use : Develop a linear program that PhotoTech can use to determine how many units of each battery pack to produce at each plant in order to minimize the total production and shipping cost associated with the new contract.
Legal curfews or restricted driving privileges : 1. Should people under 18 be subjected to legal curfews or restricted driving privileges?
Risk-free asset-how much will you invest in stock : You have $100,000 to invest in Stock D, Stock F, or a risk-free asset. You must invest all your money. Your goal is to create a portfolio that has an expected return of 11.4 percent. Assume D has an expected return of 14.9 percent, F has an expected ..
What was the arithmetic average annual return : Consider the following information on large-company stocks for a period of years. Series Arithmetic Mean Large-company stocks 13.1 % Small-company stocks 16.4 Long-term corporate bonds 6.2 Long-term government bonds 6.1 Intermediate-term government b..
Free market systems versus a command economy : s there a difference between the free market systems versus a command economy. In your own words explain the characteristics that underline both theses' systems. Provide a country example for each system.
What is the companys cost of common equity : Koshun Company just paid a dividend of $0.90. The company's common stock currently sells at a price of $30.00 and its dividend grows at a constant rate of 7.00%. What is the company's cost of common equity (RE)?
Equity transactions affect components of stockholders equity : Briefly explain (3–5 paragraphs) how equity transactions affect the components of stockholders’ equity. For instance, what impact do these transactions have on financial ratios, such as EPS (earnings per share)?
Perform an analysis of tjs product-mix problem : Perform an analysis of TJ's product-mix problem, and prepare a report for TJ's president that summarizes your findings. Be sure to include information and analysis.

Reviews

Write a Review

Financial Management Questions & Answers

  Expiration call option on IBM with exercise price

What will be the profit/loss on this position if IBM is selling at $162 on the option expiration date? What will be the profit/loss on this position if IBM is selling at $174 on the option expiration date? What kind of bet is this investor making; th..

  Exercise price equal to the face value of the debt

When a firm has risky debt, its equity can be viewed as an option on the total value of the firm with an exercise price equal to the face value of the debt.

  Motivations for using qualitative test for impairment

Defines impairment, goodwill and qualitative assessment. Provide impairment and an explanation of its impact on financial statements. What are the benefits of impairment recording to financial statement users. What are the motivations for using a qua..

  What is the firms market value capital structure

Titan Mining Corporation has 9.3 million shares of common stock outstanding and 370,000 6 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $41 per share and has a beta of 1.15, and the bonds have 20 ye..

  What is current share price-earnings to fuel growth

Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years because the firm needs to plow back its earnings to fuel growth. The company will pay a $12 per share dividend in 10 years and will..

  Most controversial topics in employment law

Affirmative action is one of the most controversial topics in employment law. How affirmative action is often presented in the media? How similar is that portrait to the one presented in Johnson v. Transportation Agency, Santa Clara County? When are ..

  What is the future value and loan problem

What is the future value of $1800 invested today at 18% interest in 30 years with interest compounded quarterly? What is the present value of $6700 received 14 years from now using on the 11% interest or discount read with interest compounded quarter..

  The total direct costs of a debt issue

The total direct costs of a debt issue, when expressed as a percentage of gross proceeds, tends to do which of the following? Why?

  Currency exchange why is it better to carry the transaction

When doing currency exchange why is it better to carry the transaction out to 5 or six places rather than round two cents? What am I losing in the transaction? Keep in mind that we are transferring millions of dollars. Identify 2 other areas that we ..

  Earnings per share are measurgement that stockholder

which is more important to today's organizations? Earnings per share (EPS) are a measurgement that stockholders, stackholders and management use to evaluate a company financial health? what do companies do if they have cash flow deficit?

  Discount rate used to calculate pension obligation

During 2011, Abbott Laboratories decreased its discount rate used to calculate pension obligation from 5.4% to 5.0%. The effect on the company’s pension expense for the year and pension obligation balance at year end is:

  Options pertaining to home mortgage financing

You are given the following options pertaining to home mortgage financing: A) Loan amount $200,00, fixed rate 3.5%, 30 year term, closing costs = $7,000. APR _______________ B) Loan amount $200,000, Fixed rate 3.25%, 30 year term, closing costs = $11..

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