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The total annual returns on large company common stocks averaged 12.4% from 1926 to 2005 small company stocks averaged 17.5%, long-term government bonds averaged 5.8%,
The total annual returns on large company common stocks averaged 12.4% from 1926 to 2005 small company stocks averaged 17.5%, long-term government bonds averaged 5.8%, while Treasury Bills averaged 3.8%. What was the average risk premium earned by long-term government bonds, and small company stocks respectively?
a.
2.0%; 13.7%
b.
1.8%; 13.3%
c.
4.4%; 11.9%
d.
None of the above.
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