4 100 a. Q3. Suppose you observe the following month end stock prices of a Stock B Month O 1 2 3 Price 105 150 97 100 What is mean monthly continuously compounded return? Annual return? a. Monthly: 100.8 b. Annual: 8.4 What is the standard deviation monthly? Annually? a. Monthly: 2.95 b. Annually: 0.246 Evaluate the statement: "The estimate of mean depends on beginning and end prices; the estimate of standard deviation on all prices." a. I wouldn't say the estimate of mean only depends on the beginning and end prices. If you have higher or lower numbers in the middle it will change the mean outcome. The estimate of standard deviation does depend on all prices. b. C. 4 100 a. Q3. Suppose you observe the following month end stock prices of a Stock B Month O 1 2 3 Price 105 150 97 100 What is mean monthly continuously compounded return? Annual return? a. Monthly: 100.8 b. Annual: 8.4 What is the standard deviation monthly? Annually? a. Monthly: 2.95 b. Annually: 0.246 Evaluate the statement: "The estimate of mean depends on beginning and end prices; the estimate of standard deviation on all prices." a. I wouldn't say the estimate of mean only depends on the beginning and end prices. If you have higher or lower numbers in the middle it will change the mean outcome. The estimate of standard deviation does depend on all prices. b. C