An investor bought 3 shares of stock A in 2010 after ex-dividend date. She purchased 2 more shares in 2011, sold 1 share in 2012 and then sold all her holding in 2013 after ex-div date. The stock paid $2 dividend per share at the end of each year. # new shares beg-of-Year stock price purchased (sold) 2010 $100 3 2011 110 2 2012 90 -1 2013 95 -4 She can receive $ X dividend payment at the beg-of-year 2012. Continued with previous question. The investor's net cash flow is $ X at the beg-of-2013 The IRR of the investment is -2.2 X % Continued with previous question. The arithmetic average of the investment's yearly return during 2010-2013 is -0.05 X %. Why the investment's arithmetic average return is positive while its money weighted average return is negative? There may be more than one answer in the choices Select one: a. The investor purchased at lower price and sold at higher price on average. X b. The worst yearly return occurred when the investor held more shares. c. The worst yearly return occurred when the investor held fewest shares.

An investor bought 3 shares of stock A in 2010 after ex-dividend date. She purchased 2 more shares in 2011 , sold 1 share in 2012 and then sold all her holding in 2013 after ex-div date. The stock paid $2 dividend per share at the end of each year. She can receive $ dividend payment at the beg-of-year 2012. Continued with previous question. The investor's net cash flow is $ at the beg-of2013 The IRR of the investment is \%. (rounded with two decimal places) Continued with previous question. The arithmetic average of the investment's yearly return during 2010-2013 is % Why the investment's arithmetic average return is positive while its money weighted average return is negative? Select one: a. The investor purchased at lower price and sold at higher price on average. b. The worst yearly return occurred when the investor held more shares. c. The worst yearly return occurred when the investor held fewest shares