Question

Ten annual returns are listed in the following table: negative 19.5−19.5% 16.916.9% 18.318.3% negative 49.8−49.8% 43.843.8% 1.51.5% negative 16.9−16.9% 45.545.5% 44.844.8% negative 3.7−3.7% a. What is the arithmetic average return over the 10-year period? b. What is the geometric average return over the 10-year period? c. If you invested $100 at the beginning, how much would you have at the end? round to five decimal places

Answer #1

Arithmetic average = sum of return / no of years

Years |
Returns |

1 | -19.5 |

2 | 16.9 |

3 | 18.3 |

4 | -49.8 |

5 | 43.8 |

6 | 1.5 |

7 | -16.9 |

8 | 45.5 |

9 | 44.8 |

10 | -3.7 |

Total |
80.9 |

Arithmetic average return = 80.90 / 10 =
**8.09%**

Geometric average return = (1- 0.195) * ( 1 + 0.169) * ( 1 + 0.183) * ( 1 -0.498) * ( 1 + 0.438) * ( 1 +0.015) * ( 1-0.169) * ( 1 +.0455) * ( 1 +0.448 ) * ( 1 -0.037) - 1

= 0.805 * 1.169 * 1.183 * 0.502 * 1.438 * 1.015 * 0.831 * 1.455 * 1.448 * 0.963 - 1

= 1.3752531 - 1

= **37.52531%**

**Value of investment = 100 * 1.3752531 =
$137.52531**

Ten annual returns are listed in the following? table:
?19.5?%
16.9?%
18.1?%
?49.3?%
43.3?%
1.8?%
?16.6?%
46.4?%
44.6?%
?3.9?%
a. What is the arithmetic average return over
the? 10-year period?
b. What is the geometric average return over
the? 10-year period?
c. If you invested? $100 at the? beginning, how
much would you have at the? end?

Ten annual returns are listed in the following table: negative
19.9% 16.9% 17.7% negative 49.7% 43.1% 1.9% negative 16.7%
46.3% 44.5% negative 3.2%
a. What is the arithmetic average return over the 10-year
period?
b. What is the geometric average return over the 10-year
period?
c. If you invested $100 at the beginning, how much would you
have at the end?

Ten annual returns are listed in the following table: -19.5%
16.3% 17.9% -49.3% 43.5% 1.6% -16.7% 46.2% 44.8% -3.4%
a. What is the arithmetic average return over the 10-year
period?
b. What is the geometric average return over the 10-year period?
The geometric average return over the 10-year period is (round to
4 decimal places)
c. If you invested $100 at the beginning, how much would you have
at the end? (round to four decimal places)

Ten annual returns are listed in the following table:
−19.8 %
16.1 %
17.9 %
−49.9 %
43.9 %
1.1 %
−16.9 %
45.6 %
44.8 %
−3.5 %
a. What is the arithmetic average return over the 10-year
period? (Round to four decimal places.)
b. What is the geometric average return over
the 10-year period? (Round to four decimal places.)
c. If you invested $100 at the beginning, how
much would you have at the end?

Ten annual returns are listed in the following table: negative
19.1−19.1% 16.916.9% 18.418.4% negative 49.7−49.7% 43.743.7%
1.91.9% negative 16.2−16.2% 46.446.4% 44.944.9% negative
3.3−3.3% a. What is the arithmetic average return over the
10-year period? b. What is the geometric average return over the
10-year period? c. If you invested $100 at the beginning, how
much would you have at the end?
round answers to 4 decimal points

1. Using the data in the table to the right,
calculate the return for investing in the stock from January 1 to
December 31. Prices are after the dividend has been paid.
Date Price Dividend
1/2/03 $32.24 -
2/5/03 $30.91 $0.19
5/14/03 $30.98 $0.18
8/13/03 $32.83 $0.17
11/12/03 $39.42 $0.18
1/2/04 $40.14 -
What is the return for the entire period? (round to two decimal
places)
2. Ten annual returns are listed in the
following table:
−19.6%
16.8%
18.2%
−49.6%...

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Year
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2002
-21.97%
2003
28.36%
2004
10.74%
2005
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2006
15.61%
2007
5.48%
2008
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2009
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2010
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