Question

Five years ago you invested $10,000 in a mutual fund. You have earned the following annual returns over the last five years {+18%,-4%,+10%,+22%,-16%}. What is the Arithmetic Mean of the five annual returns?

A) 5% B) 6% C) 3% D) 4%

What is the standard deviation of the sample of the above five returns?

A) 15.8% B) 10.4% C) 12.9% D) 14.1%

A company has the following cashflows:

Year 0: -240,000, Year 1: +10,000, Year 2: +55,000, Year 3: +100,000, Year 4: +380,000

What is the Discounted Payback for this project using a 15% discount rate?

A) Payback of 4.10 years B) Payback of 3.57 years C) Payback of 3.95 years D) Payback of 3.67 years

Answer 1