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Problem 1 - 0 5 During the past five years, you owned two stocks that had the following annual rates of return: Year Stock T

Problem 1-05
During the past five years, you owned two stocks that had the following annual rates of return:
Year Stock T Stock B
10.170.05
20.100.01
3-0.05-0.07
4-0.060.01
50.100.02
Compute the arithmetic mean annual rate of return for each stock. Round your answers to one decimal place.
Stock T:
%
Stock B:
%
Which stock is most desirable by this measure?
-Select-
is more desirable because the arithmetic mean annual rate of return is
-Select-
.
Compute the standard deviation of the annual rate of return for each stock. (Use Chapter 1 Appendix if necessary.) Do not round intermediate calculations. Round your answers to three decimal places. Answer with the population standard deviation.
Stock T:
%
Stock B:
%
By this measure, which is the preferable stock?
-Select-
is the preferable stock.
Compute the coefficient of variation for each stock. (Use the Chapter 1 Appendix if necessary.) Do not round intermediate calculations. Round your answers to four decimal places. Use the population standard deviation in your computation.
Stock T:
Stock B:
By this relative measure of risk, which stock is preferable?
-Select-
is the preferable stock.
Compute the geometric mean rate of return for each stock. Round your answers to three decimal places.
Stock T:
%
Stock B:
%

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