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Consider the following realized annual returns: Year End Market Realized Return Microsoft Realized Return 1996 21.2% 88.3% 1997 30.3% 56.4% 1998 22.3% 114.6% 1999 25.3%
Consider the following realized annual returns:
Year End | Market Realized Return | Microsoft Realized Return |
1996 | 21.2% | 88.3% |
1997 | 30.3% | 56.4% |
1998 | 22.3% | 114.6% |
1999 | 25.3% | 68.4% |
2000 | -11.0% | -62.8% |
2001 | -11.3% | 52.7% |
2002 | -20.8% | -22.0% |
2003 | 33.1% | 6.9% |
2004 | 13.0% | 9.2% |
2005 | 7.3% | -0.9% |
Suppose that you want to use the 10 year historical average return on Microsoft to forecast the expected future return on Microsoft. Required: Calculate the 95% confidence interval for your estimate of the expected return
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