Problem $1-05$

During the past five years, you owned two stocks that had the following annual rates of return:

a$.$ 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?

is more desirable because the arithmetic mean annual rate of return is

population standard deviation.

Stock T: $\%$

Stock B:

$\%$

By this measure, which is the preferable stock?

is the preferable stock.

computation.

Stock T:

Stock B:

By this relative measure of risk, which stock is preferable?

is the preferable stock.

d$.$ Compute the geometric mean rate of return for each stock. Round your answers to three decimal places.

Stock T:

$\%$

Stock B:

$\%$