The following return series comes from Global Financial Data. Year 2016 2017 2018 2019 2020 Large Stocks 12.95% 18.63% -5.28% 25.45% 19.12% LT Gov
The following return series comes from Global Financial Data. Year 2016 2017 2018 2019 2020 Large Stocks 12.95% 18.63% -5.28% 25.45% 19.12% LT Gov Bonds 2.35% 5.75% -1.25% 3.35% 9.30% US T-bills (Rf asset) 0.20% 0.60% 0.80% 1.20% 1.50% CPI (inflation) 1.90% 1.80% 2.10% 1.10% 2.10% A. calculate the average risk premium earned on large company stocks. B. using the approximate Fisher equation, calculate the risk value premium earned on large companies stocks. c. calculate the average risk premium earned on US. t-bills.
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A The average risk premium earned on large company stocks can be calculated by subtracting the avera...See step-by-step solutions with expert insights and AI powered tools for academic success
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