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Question 2, P7-7 (similar ... Part 1 of 5 HW Score: 33.33%, 1 of 3 points O Points: 0 of 1 Save (Expected rate of

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Question 2, P7-7 (similar ... Part 1 of 5 HW Score: 33.33%, 1 of 3 points O Points: 0 of 1 Save (Expected rate of return and risk) Syntex, Inc. is considering an investment in one of two common stocks. Given the information that follows, which investment is better, based on the risk (as measured by the standard deviation) and return? Common Stock A Common Stock B Probability Return Probability Return 0.20 12% 0.25 -6% 0.60 16% 0.25 5% 0.20 20% 0.25 15% 0.25 20% (Click on the icon in order to copy its contents into a spreadsheet.) a. Given the information in the table, the expected rate of return for stock Ais [%. (Round to two decimal places.) Question 3, P7-8 (similar ... Part 1 of 7 HW Score: 33.33%, 1 of 3 points Points: 0 of 1 Save (Related to Checkpoint 7.2) (Calculating the geometric and arithmetic average rate of return) Marsh Inc. had the following end-of-year stock prices over the last five years and paid no cash dividends: Time Marsh 1 $9 2 11 3 19 4 8 5 9 (Click on the icon in order to copy its contents into a preadsheet.) a. Calculate the annual rate of return for each year from the above information b. What is the arithmetic average rate of retum earned by investing in Marsh's stock over this period? a. The annual rate of return at the end of year 2 is %. (Round to two decimal places.) Question 3, P7-8 (similar ... Part 1 of 7 HW Score: 33.33%, 1 of 3 points O Points: 0 of 1 Save Time Marsh 1 $9 2 11 3 19 4 8 5 9 (Click on the icon in order to copy its contents into a spreadsheet) a. Calculate the annual rate of return for each year from the above information b. What is the arithmetic average rate of return earned by investing in Marsh's stock over this period? c. What is the geometric average rate of return earned by investing in Marsh's stock over this period? d. Considering the beginning and ending stock prices for the five-year period are the same, which type of average rate of return (the arithmetic or geometric) better describes the average annual rate of return earned over the period? a. The annual rate of return at the end of year 2 is %. (Round to two decimal places.)

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