(Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end of year stock prices over the last five years and paid no cash dividends Brangus cattle Comapny a. Calculate the annual rate of return for each year from the above information b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? What is the geometric average rate of return earned by investing in Brangus Cattle Company's stock over this period? d. Which type of average rate of return best describes the average annual rate of return camed over the period the arithmetic or geometneWhy? 2. The annual rate of return at the end of year 2 is (Round to two decimal places) The annual rate of return at the end of year is Round to two deomal places) The annual rate of return at the end of year 4 is Round to two decimal places) The annual rate of retum at the end of year 5 iss Round to two decimal places) (Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end of year stock prices over the last five years and paid no cash dividends Time Brangus cattle Comapny a. Calculate the annual rate of return for each year from the above information b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? c. What is the geometric average rate of return earned by investing in Brangus Cattle Company's stock over this period? d. Which type of average rate of return best describes the average annual rate of returneamed over the period the arithmetic or Geometric? Why? b. The arithmetic average rate of retum eamed by investing in Brangus Cattle Company's stock over this period is Round to two decimal places) c. The geometric average rate of return eamed by investing in Brangus Cattle Company's stock over this periodis (Round to two decimal places) d. Which type of average rate of retum best describes the average annual rate of returneamed over the period (the arithmetic or geometricy? Why? (Select the best choice below) O A. Arithmetic average retum best describes the average annual rate of return over a period because it takes compounding into account soit answer the question concering the expected rate of retum over a multi-year period Click to select your answers) (Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus Cattle Company had the following end-of-year stock prices over the last five years and paid no dividends Time Brangus cattle Comapny a. Calculate the annual rate of return for each year from the above information b. What is the arithmetic average rate of return earned by investing in Brangus Cattle Company's stock over this period? c. What is the geometric average rate of return eamed by investing in Brangus Cattle Company's stock over this period? d. Which type of average rate of return best describes the average annual rate of retum earned over the period the arithmetic or comerci? Why? over a multi-year period OB Geometnc average return best describes the average annual rate of return over a period because it is a simple average so it answers the question concerning the expected rate of return over a multi-year period OC. Arithmetic average return best describes the average annual rate of retur over a period because it is a simple average, so it answer the question concerning the expected rate of retum over a multi-year period OD. Geometric average return best describes the average annual rate of retum over a period because it takes compounding into account, so it answers the question concering the expected rate of retu over a multi-year period Click to select your answer(s)
