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1. You've observed the following returns on Boca Inc's stock over the past five years: 7 percent, -13 percent, 21 percent, 34 percent, and 15

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1. You've observed the following returns on Boca Inc's stock over the past five years: 7 percent, -13 percent, 21 percent, 34 percent, and 15 percent. What was the arithmetic average return on Crash-n-Burn's stock over this five-year period? What was the variance of Crash-n-Burn's retums over this period? The standard deviation? 2. A stock has had the following year-end prices and dividends: I Year Price Dividend 1 $51.50 2 59.32 $.65 3 64.13 70 4 57.86 77 5 65.1S 86 6 74.8 95 What are the arithmetic and geometric returns for the stock? 3. Based on the following information, calculate the expected return and standard deviation for the two stocks: State of Economy Probability of State of Econonry Rate of Return If State Occurs Stock A 04 .09 Stock B Recession Normal Boom 15 12 .27 .30 4. Calculate portfolio standard deviation for the following two stock portfolio where: weight in stock A is 40% std deviation of Stock A is 8.44% std deviation of Stock B is 9.69% covariance between Stock A and Stock B is-0.00796

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