Question

Problem 10-18 Return Distributions [LO 3] Consider the following table for different assets for 1926 through...

Problem 10-18 Return Distributions [LO 3]

Consider the following table for different assets for 1926 through 2011.

  Series

Average return

Standard Deviation

  Large-company stocks

11.8

%

20.3

%

  Small-company stocks

16.5

32.5

  Long-term corporate bonds

6.4

8.4

  Long-term government bonds

6.1

9.8

  Intermediate-term government bonds

5.5

5.7

  U.S. Treasury bills

3.6

3.1

  Inflation

3.1

4.2

Requirement 1:

What range of returns would you expect to see 68 percent of the time for large-company stocks? (Negative amount should be indicated by a minus sign. Input your answers from lowest to highest to receive credit for your answers. Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

  Expected range of returns

% to %

Requirement 2:

What about 95 percent of the time? (Negative amount should be indicated by a minus sign. Input your answers from lowest to highest to receive credit for your answers. Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

  Expected range of returns

% to %

rev: 05_02_2015_QC_CS-15225

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