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1)(30 points) Consider the following end-of-day prices for a certain share Po = 22, P2 = 30, P2 = 15, Pz = 18. a)(6 points)Calculate
1)(30 points) Consider the following end-of-day prices for a certain share Po = 22, P2 = 30, P2 = 15, Pz = 18. a)(6 points)Calculate the returns per day for each of the three consecutive day-periods. b)(2 points)Calculate the arithmetic average of the three returns. c)(6 points)Calculate the geometric average of the three returns. d)(6 points)Calculate the return for the 3-day period, R[0,3], then compare 1 + R[0,3] to (1 + G)3 where is the geometric average of returns found in part c. e)(4 points)Calculate the volatility of the returns found in part a. f)6 points)Calculate the approximate instantaneous rate of return by using logarithms at each of days 1 and 2. 1)(30 points) Consider the following end-of-day prices for a certain share Po = 22, P2 = 30, P2 = 15, Pz = 18. a)(6 points)Calculate the returns per day for each of the three consecutive day-periods. b)(2 points)Calculate the arithmetic average of the three returns. c)(6 points)Calculate the geometric average of the three returns. d)(6 points)Calculate the return for the 3-day period, R[0,3], then compare 1 + R[0,3] to (1 + G)3 where is the geometric average of returns found in part c. e)(4 points)Calculate the volatility of the returns found in part a. f)6 points)Calculate the approximate instantaneous rate of return by using logarithms at each of days 1 and 2
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