a) What is the annual geometric average of returns?

b) What is the problem with using arithmetic returns, and why do we prefer to also look at geometric returns?

c) Calculate the two-sided 95% confidence interval for EJR Corporation, assuming that returns are usually normally distributed. Interpret your confidence interval in one sentence. (You have to calculate the standard deviation & variance of returns, using the geometric average you calculated in part a)

d) Imagine you were to invest 10,000$ in EJR corporation. According to your confidence band calculated in part c, what is most you would lose 95% of the time.

Please Show all work. Thank you!

Table 5 contains 6 years of returns for EJR Corporation. Table 5: EJR Corporation Stock Returns Year EJR Return 2014 2% 2015 4% 2016 3% 2017 -2% 2018 -1% 2019 1% Table 5 contains 6 years of returns for EJR Corporation. Table 5: EJR Corporation Stock Returns Year EJR Return 2014 2% 2015 4% 2016 3% 2017 -2% 2018 -1% 2019 1%