5 6 7 8 9 . Use the data given to calculate annual returns for Bartman, Reynolds, and the Market Index, and then calculate average returns over the five-year period. (Hint: Remember, returns are calculated by subtracting the beginning price from the ending price to get the capital gain or loss, adding the dividend to the capital gain or loss, and dividing the result by the beginning price. Assume that dividends are already included in the indes. Also, you cannot calculate the rate of return for 2005 because you do not have 2004 data.) 11 Data as given in the problem are shown below: Bartman Industries Reynolds Incorporated Year Stock Price Dividend Stock Price 2010 $17.250 $1.150 $48.750 2009 14.750 1.000 52.300 2008 16.500 1.000 48.750 2007 10.750 0.950 57.250 2006 11.375 0.900 60.000 2005 7.625 0.850 55.750 20 21 We now calculate the rates of return for the two companies and the index: Market Index Dividendlich Dividend Includes Divs. $3.000 11.663.98 2.900 8,785,70 2.750 8,679.98 2.500 6,434.03 2.250 2.000 ./05.97 Bartman Reynolds Index NON 2010 2009 2008 2007 2006 30 Average 32 Note: To get the average, you could get the column sum and divide by 5, but you could also use the function wizard, fx. 33 Click ix, then statistical, then Average, and then use the mouse to select the proper range. Do this for Bartman and then copy 34 the cell for the other items. 36 b. Calculate the standard deviation of the returns for Bartman, Reynolds, and the Market Index. (llint: Use the 37 sample standard deviation formula given in the chapter, which corresponds to the STDEV function in Excel) 39 Use the function wizard to calculate the standard deviations. 40 41 Bartman Reynolds 42 Standard deviation of returns 43