65) To convince investors to accept greater volatility, increase the risk premium ) decrease the real return. C) increase the risk-free rate. D) decrease the risk premium. E) decrease the risk-free rate. you must 5) 66) Which one of the following categories of securities had the most volatile annual returns 66) over the period 1926-20167 A) Large-company stocks B) Long-term corporate bonds Intermediate-term govemment bonds Small-company stocks U.S. Treasury bills 67) Stamlard deviation is a measure of which one of the following? 67 ity bility C) Average rate of return D) Risk premium E) Real returns 68) Assume all stock prices fairly reflect all of the available information on those stocks.) Which one of the following terms best defines the stock market under these conditions? A) Zero volatility market B) Riskless market C) Efficient capital market D) Evenly distributed market E) Blume's market en. 69) 69) A stock had annual returns of 5.1 percent, 12.2 percent, -3.8 percent, and 9.4 percent for the past four years. The arithmetic average of these returns is percent while the geometric average return for the period is percent. A) 5.73; 5.55 B) 5.91; 5.74 C) 5.91; 5.62 D) 5.73;8.92 E) 5.73; 5.06 70) 70) The expected return on a stock computed using economic probabilities is: A) guaranteed to be the minimal rate of return on the stock over the next two years. B) a mathematical expectation based on a weighted average and not an actual anticipated outcome. C) guaranteed to equal the actual average return on the stock for the next five years. D) the actual return you should anticipate as long as the economic forecast remains constant E) guaranteed to equal the actual return for the immediate twelve month period. 13