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A company's stock price rose 1.41.4%in 2011, and in 2012, it increased 17.717.7%. a. . Compute the geometric mean rate of return for the two-year
A company's stock price rose 1.41.4%in 2011, and in 2012, it increased 17.717.7%.
a. . | Compute the geometric mean rate of return for the two-year period 2011minus2012. (Hint: Denote an increase of 17.717.7% by 0.1770.177.) |
b. | If someone purchased $1,000 of the company's stock at the start of 2011, what was its value at the end of 2012? |
c. | Over the same period, another company had a geometric mean rate of return of 34.9534.95%.If someone purchased $1,000 of the other company's stock, how would its value compare to the value found in part (b)? |
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