Question

3. The following table provides data on the annual stock prices for DEW Technologies. Compute the average annual return and the standard deviation of annual returns. (Using excel)

DEW Technologies
1	Date	Closing Price
2	2-Jan2001	$1.51
3	2-Jan-2002	$1.68
4	2-Jan-2003	$1.93
5	2-Jan-2004	$1.74
6	2-Jan-2005	$2.04
7	2-Jan-2006	$2.06
8	2-Jan-2007	$2.22
9	2-Jan-2008	$1.88
10	2-Jan-2009	$1.76
11	2-Jan-2010	$2.03
12	2-Jan-2011	$2.67
13	2-Jan-2012	$3.12
14	2-Jan-2013	$3.44
15	2-Jan-2014	$3.72

Answer 1

using excel to calculate

		A	B	C
	DEW Technologies
	1	Date	Closing Price	Returns(Closing of current year- Closing price of Previous Year)/Closing price of previous year
1	2	2-Jan-01	$1.51
2	3	2-Jan-02	$1.68	11.26%
3	4	2-Jan-03	$1.93	14.88%
4	5	2-Jan-04	$1.74	-9.84%
5	6	2-Jan-05	$2.04	17.24%
6	7	2-Jan-06	$2.06	0.98%
7	8	2-Jan-07	$2.22	7.77%
8	9	2-Jan-08	$1.88	-15.32%
9	10	2-Jan-09	$1.76	-6.38%
10	11	2-Jan-10	$2.03	15.34%
11	12	2-Jan-11	$2.67	31.53%
12	13	2-Jan-12	$3.12	16.85%
13	14	2-Jan-13	$3.44	10.26%
14	15	2-Jan-14	$3.72	8.14%
			Average	7.90%
			Excel formula	AVERAGE(C2:C14)
			Standard Deviation	12.76%
			Excel formula	STDEV(C2:C14)

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