Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Assume that over the past 85 years, the total annual returns on large-company common stocks averaged 12.3 percent, small-company stocks averaged 17.4 percent, long-term government

Assume that over the past 85 years, the total annual returns on large-company common stocks averaged 12.3 percent, small-company stocks averaged 17.4 percent, long-term government bonds averaged 5.7 percent, and U.S. T-bills averaged 3.8 percent. What was the average risk premium earned by long-term government bonds, and small-company stocks respectively? 1.8%; 13.3% 1.9%; 13.6% 4.4%; 11.9% 1.9%; 5.1% -6.6; 5.1%;

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Automated Stock Trading Systems

Authors: Laurens Bensdorp

1st Edition

1544506031, 978-1544506036

More Books

Students also viewed these Finance questions

Question

30. In Prob. 28, if PP' = I, show that P'A' is a c-inverse of AP.

Answered: 1 week ago

Question

4. Describe the factors that influence self-disclosure

Answered: 1 week ago

Question

1. Explain key aspects of interpersonal relationships

Answered: 1 week ago