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Problem Set: 10A 1 - What is the average return for Investment A and Investment B? 2 -If US Treasury bills have an average return

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Problem Set: 10A 1 - What is the average return for Investment A and Investment B? 2 -If US Treasury bills have an average return of 1%, what is the risk premium for Investment A and B? 3 - If you could pick only one investment, which would you buy: A or B? Investment A Investment B Annual Annual Returns Returns Year 1 -11% 5% Year 2 16% 2% Year 3 -7% 8% Year 4 20% 3%

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