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Suppose we have the following returns for large-company stocks and Treasury bills over a six-year period: Year Large- Company US Treasury bills stocks 123456

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Suppose we have the following returns for large-company stocks and Treasury bills over a six-year period: Year Large- Company US Treasury bills stocks 123456 3.97% 6.59% 14.34 4.42 19.23 4.29 -14.45 7.32 5.28 5.38 a. -31.94 37.47 Calculate the arithmetic average returns for large-company stocks and T-bills over this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the standard deviation of the returns for large-company stocks and T-bills over this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c-1. Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the average risk premium over this period? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c-2. Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the standard deviation of the risk premium over this period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Large-company stocks 4.77 % a. T-bills 5.54 % b. Large-company stocks 24.84 % b. T-bills 1.19 % c-1. Average risk premium % c-2. Standard deviation %

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