1. What is the historical average annual rate of return on large company stocks and small company stocks?

Group of answer choices

a. 12%; 6%

b. 4%; 7%

c. 12%; 16%

d. 6%; 10%

2. Rank the following asset classes from lowest to highest risk. (T stands for Treasury.)

• T-bills, Gov. bonds, corporate bonds, large company stocks, small company stocks

Group of answer choices

a. corporate bonds, T-bills, Gov. bonds, small company stocks, large company stocks

b. large company stocks, small company stocks, T-bills, Gov. bonds, corporate bonds

c. T-bills, Gov. bonds, corporate bonds, large company stocks, small company stocks

d. T-bills, Gov. bonds, corporate bonds, small company stocks, large company stocks

3. Rank the following asset classes from lowest to highest return.

• T-bills, Gov. bonds, corporate bonds, large company stocks, small company stocks

Group of answer choices

a. corporate bonds, T-bills, Gov. bonds, small company stocks, large company stocks

b. T-bills, Gov. bonds, corporate bonds, small company stocks, large company stocks

c. large company stocks, small company stocks, T-bills, Gov. bonds, corporate bonds

d. T-bills, Gov. bonds, corporate bonds, large company stocks, small company stocks

4. Assume a class of stocks has a historical average annual return of 10% with a standard deviation of 10%. Historically, 95% of annual returns have been between approximately ___ and ___.

Group of answer choices

a. 10%; 20%

b. -10%; 30%

c. 0%; 20%

d. -10%; 10%