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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 bill 1 3.69% 4.75%

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

Year large company US treasury bill

1

3.69% 4.75%
2 14.48 3.59
3 19.27 4.18
4 -14.41 5.91
5 -31.9 5.32
6 37.51 6.41
a.

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.)

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