Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

F. In 2002, all the major stock market indexes decreased dramatically as the attacks on 9/11 drove stock prices spiraling downward. Stocks soon rebounded, but

image text in transcribed
F. In 2002, all the major stock market indexes decreased dramatically as the attacks on 9/11 drove stock prices spiraling downward. Stocks soon rebounded, but what type of mean return did investors experience over the four-year period from 2002 to 2005? The data in the following table (contained in indexes.xls) represent the total rate of return (in percentage) for the Dow Jones Industrial Average (DJIA), the Standard 85 Poor's 500 (S&P 500), and the technologyheavy NASDAQ Composite (Nasdaq). Year DJIA S&P 500 NASDAQ 2005 -0.6 2.9 1.4 2004 3.4 9.1 8.6 2003 30.0 26.4 50.0 2002 16.8 24.2 ~31.5 a. Calculate the geometric mean rate of return for the DJIA, S&P 500, and Nasdaq. b. What conclusions can you reach concerning the geometric rates of return of the three market indexes

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

Step: 3

blur-text-image

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

A First Course in Differential Equations with Modeling Applications

Authors: Dennis G. Zill

10th edition

978-1111827052

More Books

Students also viewed these Mathematics questions