Rate of return, standard deviation, coefficient of variationPersonal Finance ProblemMike is searching for a stock to include in his current stock portfolio. He is interested in Hi-Tech Inc.; he has been impressed with the company's computer products and believes Hi-Tech is an innovative market player. However, Mike realizes that any time you consider a technology stock, risk is a major concern. The rule he follows is to include only securities with a coefficient of variation of returns below . Mike has obtained the following price information for the period 2012 through 2015: LOADING.... Hi-Tech stock, being growth-oriented, did not pay any dividends during these 4 years.

a.Calculate the rate of return for each year, 2012 through 2015, for Hi-Tech stock

. b.Assume that each year's return is equally probable and calculate the average return over this time period.

c.Calculate the standard deviation of returns over the past 4 years.(Hint: Treat this data as a sample.)

d.Based on b and c determine the coefficient of variation of returns for the security.

e.Given the calculation in d what should be Mike's decision regarding the inclusion of Hi-Tech stock in his portfolio? Question content area bottom Part 1

a.The rate of return for year 2012 is enter your response here%. (Round to two decimal places.)

Part 2 The rate of return for year 2013 is enter your response here%. (Round to two decimal places.)

Part 3 The rate of return for year 2014 is enter your response here%. (Round to two decimal places.)

Part 4 The rate of return for year 2015 is enter your response here%. (Round to two decimal places.)

Part 5 b.The average return over this time period is enter your response here%. (Round to two decimal places.)

Part 6 c.The standard deviation of returns over the past 4 years is enter your response here%. (Round to two decimal places.)

Part 7 d.The coefficient of variation of returns for Hi-Tech stock is enter your response here. (Round to two decimal places.)

Part 8 e.Given the calculation in d what should be Mike's decision regarding the inclusion of Hi-Tech stock in his portfolio?(Select the best answer below.)

Mike will not include Hi-Tech stock in his portfolio because the coefficient of variation of the security is not below .

Mike will include Hi-Tech stock in his portfolio because the coefficient of variation of the security is below .

Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.)

		Stock price
Year		Beginning		End
2012		$14.75		$20.27
2013		$20.27		$64.23
2014		$64.23		$71.82
2015		$71.82		$90.76