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questions 25-28 please and thanks 25. You buy some shares of a stock on June 30, 2008 for $3,000 and sell it on June 30,
questions 25-28 please and thanks
25. You buy some shares of a stock on June 30, 2008 for $3,000 and sell it on June 30, 2016 for $7,142. Assume you did not pay any commissions and the stock did not pay any dividends. What is your annual arithmetic average return, your annual geometric average return, and your annual continuously compounded return? Round to the nearest tenth of a percent. a. 17.3%, 10.8%, 11.5% b. 10.8%, 11.5%, 17.3% c. 11.5%, 17.3%, 10.8% d. 17.3%, 11.5%, 10.8% e. None of the above 26. Which of the following statements are true? a. The real interest rate is equal to the nominal interest rate, plus the inflation rate b. The nominal interest rate implies a very small interest rate at any time C. The inflation rate is equal to the real interest rate minus the Fed Funds rate d. The nominal interest rate plus the real interest rate equal equal the inflation rate e. None of the above 27. What interest rate do financial economists primarily use as the risk-free rate? a. The rate on Eurodollar deposits b. The rate on Fannie Mae bonds C. The rate on banker's acceptances d. The rate on bank savings accounts e. None of the above 28. Suppose that Jobonga Corporation's stock has a beta of 2, the expected return on the market portfolio is 13%, and the riskfree rate is 4%. According to the CAPM, the expected return on Jobonga's stock should be: a. 38% b. 30% C. 14% d. -14% e. None of the aboveStep by Step Solution
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