Yearly returns from 1926 2014 for the S P 500, small stocks, corporate bonds, world portfolio, Treasury bills, and inflation (as measured by the CPI) Year S P 500 Small Stocks Corp Bonds World Portfolio Treasury Bills CPI 1926 0 11138 0 072 0 06285 0 228 0 03194 0 01188 1927 0 37126 0 25754 0 0655 0 25326 0 03125 0 02163 1928 0 43308 0 46872 0 03377 0 33463 0 03824 0 01229 1929 0 08907 0 50467 0 04321 0 07692 0 04737 0 00746 1930 0 25257 0 45583 0 06343 0 22574 0 02347 0 0642 1931 0 43858 0 50216 0 0238 0 39305 0 01023 0 09235 1932 0 08861 0 08696 0 12198 0 0303 0 00806 0 10465 1933 0 52895 1 872 0 05255 0 66449 0 00293 0 00974 1934 0 02341 0 25209 0 09728 0 02552 0 00155 0 01286 1935 0 47208 0 64739 0 0686 0 22782 0 00165 0 03175 1936 0 32801 0 87508 0 0622 0 19283 0 00175 0 01231 1937 0 35258 0 53403 0 02546 0 1695 0 00319 0 0304 1938 0 33199 0 26275 0 04357 0 05614 0 00041 0 0295 1939 0 0091 0 00184 0 04247 0 01441 0 00008 0 1940 0 10082 0 1234 0 04512 0 03528 0 00058 0 00912 1941 0 11767 0 13728 0 01788 0 18744 0 00042 0 0994 1942 0 21076 0 52504 0 03119 0 01189 0 00262 0 09041 1943 0 25758 1 0 03365 0 19895 0 0034 0 02764 1944 0 19694 0 60408 0 03101 0 1024 0 00321 0 02445 1945 0 36461 0 82665 0 03512 0 11032 0 00321 0 02148 1946 0 0818 0 12608 0 02558 0 15124 0 00352 0 18224 1947 0 0524 0 02658 0 0045 0 03196 0 00461 0 08893 1948 0 05099 0 06609 0 03707 0 0573 0 00979 0 02904 1949 0 18065 0 21502 0 04327 0 05421 0 01106 0 02116 1950 0 30579 0 45908 0 01891 0 25477 0 01213 0 05946 1951 0 24553 0 09767 0 0021 0 22446 0 01483 0 06122 1952 0 18501 0 06472 0 03427 0 15822 0 01642 0 00641 1953 0 01099 0 05985 0 02061 0 04838 0 0178 0 00796 1954 0 52404 0 65232 0 04658 0 49823 0 00863 0 0079 1955 0 31429 0 2211 0 01075 0 24739 0 01555 0 00478 1956 0 06627 0 03459 0 01792 0 06581 0 02422 0 02853 1957 0 10853 0 15053 0 04469 0 06017 0 03129 0 02928 1958 0 43344 0 70923 0 00849 0 34456 0 01415 0 01796 1959 0 11904 0 1868 0 00157 0 23303 0 02815 0 01765 1960 0 00483 0 05004 0 06722 0 03492 0 02582 0 01301 1961 0 26811 0 30836 0 03681 0 20778 0 02159 0 00713 1962 0 08784 0 1295 0 06204 0 06212 0 02724 0 01275 1963 0 22691 0 18093 0 03167 0 15381 0 03151 0 01678 1964 0 16358 0 19405 0 03988 0 11247 0 03518 0 00963 1965 0 12356 0 36365 0 02082 0 09832 0 03962 0 01907 1966 0 10105 0 07302 0 00255 0 10116 0 04705 0 03476 1967 0 23942 0 77916 0 01162 0 21283 0 04147 0 03101 1968 0 11002 0 47611 0 22457 0 13941 0 05294 0 04637 1969 0 08466 0 32219 0 02459 0 03858 0 06591 0 06228 1970 0 03986 0 04503 0 11179 0 01984 0 06383 0 05524 1971 0 14325 0 16347 0 09682 0 19567 0 04317 0 03312 1972 0 18936 0 04222 0 08323 0 23547 0 03891 0 03413 1973 0 14791 0 35936 0 02987 0 14506 0 07059 0 087 1974 0 26539 0 27327 0 00233 0 2448 0 08078 0 12328 1975 0 3725 0 82769 0 11039 0 34493 0 05821 0 06962 1976 0 23675 0 57116 0 14557 0 14712 0 05156 0 04824 1977 0 07388 0 19915 0 0551 0 02002 0 05152 0 0672 1978 0 0644 0 2042 0 01833 0 18216 0 07308 0 09035 1979 0 18353 0 39698 0 01558 0 12671 0 1069 0 13308 1980 0 32266 0 29141 0 04976 0 27721 0 11523 0 12521 1981 0 05053 0 14617 0 08977 0 03305 0 14856 0 08912 1982 0 21483 0 3225 0 34898 0 11272 0 10664 0 03797 1983 0 225 0 48048 0 07317 0 2328 0 08847 0 03833 1984 0 06152 0 02495 0 17103 0 05773 0 09956 0 03943 1985 0 31648 0 29125 0 29486 0 4177 0 07677 0 03793 1986 0 18603 0 05908 0 20913 0 42799 0 06057 0 01089 1987 0 05171 0 09204 0 01578 0 16764 0 05384 0 04423 1988 0 16608 0 20288 0 13793 0 2395 0 06323 0 0442 1989 0 31686 0 01488 0 1531 0 17194 0 08221 0 04656 1990 0 03104 0 36325 0 08606 0 16517 0 0768 0 061 1991 0 30466 0 41799 0 15869 0 18966 0 05507 0 03081 1992 0 07619 0 22075 0 10642 0 0466 0 03401 0 02897 1993 0 10079 0 13792 0 14662 0 23129 0 02899 0 02755 1994 0 0132 0 01096 0 02435 0 05584 0 0388 0 02652 1995 0 37578 0 20056 0 21991 0 21318 0 05532 0 02555 1996 0 2296 0 21511 0 04239 0 13993 0 05145 0 03322 1997 0 33363 0 3208 0 10847 0 16227 0 05082 0 01688 1998 0 28579 0 11975 0 10908 0 24795 0 04781 0 01607 1999 0 21042 0 0126 0 03037 0 25354 0 04561 0 02697 2000 0 09104 0 0249 0 11694 0 12928 0 05756 0 03384 2001 0 11886 0 32781 0 11461 0 16521 0 03779 0 01563 2002 0 22101 0 05624 0 11181 0 19541 0 01634 0 02357 2003 0 28685 0 69151 0 09229 0 33761 0 01018 0 0188 2004 0 10882 0 31392 0 0651 0 15247 0 012 0 03275 2005 0 04911 0 03988 0 07734 0 10023 0 02963 0 03417 2006 0 15795 0 26379 0 04167 0 20652 0 04786 0 02526 2007 0 05494 0 111 0 04742 0 09566 0 04675 0 04086 2008 0 36998 0 45864 0 13449 0 40334 0 01474 0 00101 2009 0 26464 1 12127 0 00018 0 30793 0 00097 0 02709 2010 0 15064 0 3361 0 07972 0 12339 0 00122 0 01496 2011 0 02112 0 07155 0 14703 0 05017 0 00043 0 02967 2012 0 16003 0 21311 0 04513 0 16537 0 00057 0 01733 2013 0 32388 0 50814 0 03067 0 27365 0 00028 0 01518 2014 0 13688 0 04541 0 11658 0 05504 0 00016 0 00748 Given the data from the following table What if the period from 1990 to 2014 had been normal a Calculate the arithmetic average return on the S P 500 from 1926 to 1989 b Replace the actual returns from 1990 to 2014 with the average return from (a) How much would $100 invested in the S P 500 at the end of 1925 have grown to by the end of 2014 (Hint Use the actual returns from 1926 to 1989 and then continue the growth at the assumed rate ) C Do the same for small stocks a Calculate the arithmetic average return on the S P 500 from 1926 to 1989 The arithmetic average return of the S P 500 from 1926 to 1989 is (Round to two decimal places )

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Yearly returns from 1926-2014 for the S&P 500, small stocks, corporate bonds, world portfolio, Treasury bills, and inflation (as measured by the CPI) Year S&P

Yearly returns from 1926-2014 for the S&P 500, small stocks, corporate bonds, world portfolio, Treasury bills, and inflation (as measured by the CPI)
Year	S&P 500	Small Stocks	Corp Bonds	World Portfolio	Treasury Bills	CPI
1926	0.11138	-0.072	0.06285	0.228	0.03194	-0.01188
1927	0.37126	0.25754	0.0655	0.25326	0.03125	-0.02163
1928	0.43308	0.46872	0.03377	0.33463	0.03824	-0.01229
1929	-0.08907	-0.50467	0.04321	-0.07692	0.04737	0.00746
1930	-0.25257	-0.45583	0.06343	-0.22574	0.02347	-0.0642
1931	-0.43858	-0.50216	-0.0238	-0.39305	0.01023	-0.09235
1932	-0.08861	0.08696	0.12198	0.0303	0.00806	-0.10465
1933	0.52895	1.872	0.05255	0.66449	0.00293	0.00974
1934	-0.02341	0.25209	0.09728	0.02552	0.00155	0.01286
1935	0.47208	0.64739	0.0686	0.22782	0.00165	0.03175
1936	0.32801	0.87508	0.0622	0.19283	0.00175	0.01231
1937	-0.35258	-0.53403	0.02546	-0.1695	0.00319	0.0304
1938	0.33199	0.26275	0.04357	0.05614	0.00041	-0.0295
1939	-0.0091	0.00184	0.04247	-0.01441	0.00008	0
1940	-0.10082	-0.1234	0.04512	0.03528	-0.00058	0.00912
1941	-0.11767	-0.13728	0.01788	0.18744	0.00042	0.0994
1942	0.21076	0.52504	0.03119	0.01189	0.00262	0.09041
1943	0.25758	1	0.03365	0.19895	0.0034	0.02764
1944	0.19694	0.60408	0.03101	-0.1024	0.00321	0.02445
1945	0.36461	0.82665	0.03512	0.11032	0.00321	0.02148
1946	-0.0818	-0.12608	0.02558	-0.15124	0.00352	0.18224
1947	0.0524	-0.02658	0.0045	0.03196	0.00461	0.08893
1948	0.05099	-0.06609	0.03707	-0.0573	0.00979	0.02904
1949	0.18065	0.21502	0.04327	0.05421	0.01106	-0.02116
1950	0.30579	0.45908	0.01891	0.25477	0.01213	0.05946
1951	0.24553	0.09767	-0.0021	0.22446	0.01483	0.06122
1952	0.18501	0.06472	0.03427	0.15822	0.01642	0.00641
1953	-0.01099	-0.05985	0.02061	0.04838	0.0178	0.00796
1954	0.52404	0.65232	0.04658	0.49823	0.00863	-0.0079
1955	0.31429	0.2211	0.01075	0.24739	0.01555	0.00478
1956	0.06627	0.03459	-0.01792	0.06581	0.02422	0.02853
1957	-0.10853	-0.15053	0.04469	-0.06017	0.03129	0.02928
1958	0.43344	0.70923	0.00849	0.34456	0.01415	0.01796
1959	0.11904	0.1868	0.00157	0.23303	0.02815	0.01765
1960	0.00483	-0.05004	0.06722	0.03492	0.02582	0.01301
1961	0.26811	0.30836	0.03681	0.20778	0.02159	0.00713
1962	-0.08784	-0.1295	0.06204	-0.06212	0.02724	0.01275
1963	0.22691	0.18093	0.03167	0.15381	0.03151	0.01678
1964	0.16358	0.19405	0.03988	0.11247	0.03518	0.00963
1965	0.12356	0.36365	0.02082	0.09832	0.03962	0.01907
1966	-0.10105	-0.07302	-0.00255	-0.10116	0.04705	0.03476
1967	0.23942	0.77916	-0.01162	0.21283	0.04147	0.03101
1968	0.11002	0.47611	0.22457	0.13941	0.05294	0.04637
1969	-0.08466	-0.32219	-0.02459	-0.03858	0.06591	0.06228
1970	0.03986	-0.04503	0.11179	-0.01984	0.06383	0.05524
1971	0.14325	0.16347	0.09682	0.19567	0.04317	0.03312
1972	0.18936	0.04222	0.08323	0.23547	0.03891	0.03413
1973	-0.14791	-0.35936	0.02987	-0.14506	0.07059	0.087
1974	-0.26539	-0.27327	0.00233	-0.2448	0.08078	0.12328
1975	0.3725	0.82769	0.11039	0.34493	0.05821	0.06962
1976	0.23675	0.57116	0.14557	0.14712	0.05156	0.04824
1977	-0.07388	0.19915	0.0551	0.02002	0.05152	0.0672
1978	0.0644	0.2042	0.01833	0.18216	0.07308	0.09035
1979	0.18353	0.39698	-0.01558	0.12671	0.1069	0.13308
1980	0.32266	0.29141	-0.04976	0.27721	0.11523	0.12521
1981	-0.05053	0.14617	0.08977	-0.03305	0.14856	0.08912
1982	0.21483	0.3225	0.34898	0.11272	0.10664	0.03797
1983	0.225	0.48048	0.07317	0.2328	0.08847	0.03833
1984	0.06152	-0.02495	0.17103	0.05773	0.09956	0.03943
1985	0.31648	0.29125	0.29486	0.4177	0.07677	0.03793
1986	0.18603	0.05908	0.20913	0.42799	0.06057	0.01089
1987	0.05171	-0.09204	-0.01578	0.16764	0.05384	0.04423
1988	0.16608	0.20288	0.13793	0.2395	0.06323	0.0442
1989	0.31686	0.01488	0.1531	0.17194	0.08221	0.04656
1990	-0.03104	-0.36325	0.08606	-0.16517	0.0768	0.061
1991	0.30466	0.41799	0.15869	0.18966	0.05507	0.03081
1992	0.07619	0.22075	0.10642	-0.0466	0.03401	0.02897
1993	0.10079	0.13792	0.14662	0.23129	0.02899	0.02755
1994	0.0132	-0.01096	-0.02435	0.05584	0.0388	0.02652
1995	0.37578	0.20056	0.21991	0.21318	0.05532	0.02555
1996	0.2296	0.21511	0.04239	0.13993	0.05145	0.03322
1997	0.33363	0.3208	0.10847	0.16227	0.05082	0.01688
1998	0.28579	-0.11975	0.10908	0.24795	0.04781	0.01607
1999	0.21042	-0.0126	-0.03037	0.25354	0.04561	0.02697
2000	-0.09104	-0.0249	0.11694	-0.12928	0.05756	0.03384
2001	-0.11886	0.32781	0.11461	-0.16521	0.03779	0.01563
2002	-0.22101	-0.05624	0.11181	-0.19541	0.01634	0.02357
2003	0.28685	0.69151	0.09229	0.33761	0.01018	0.0188
2004	0.10882	0.31392	0.0651	0.15247	0.012	0.03275
2005	0.04911	0.03988	0.07734	0.10023	0.02963	0.03417
2006	0.15795	0.26379	0.04167	0.20652	0.04786	0.02526
2007	0.05494	-0.111	0.04742	0.09566	0.04675	0.04086
2008	-0.36998	-0.45864	0.13449	-0.40334	0.01474	0.00101
2009	0.26464	1.12127	0.00018	0.30793	0.00097	0.02709
2010	0.15064	0.3361	0.07972	0.12339	0.00122	0.01496
2011	0.02112	-0.07155	0.14703	-0.05017	0.00043	0.02967
2012	0.16003	0.21311	0.04513	0.16537	0.00057	0.01733
2013	0.32388	0.50814	-0.03067	0.27365	0.00028	0.01518
2014	0.13688	-0.04541	0.11658	0.05504	0.00016	0.00748

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Given the data from the following table: What if the period from 1990 to 2014 had been "normal"? a. Calculate the arithmetic average return on the S&P 500 from 1926 to 1989. b. Replace the actual returns from 1990 to 2014 with the average return from (a). How much would $100 invested in the S&P 500 at the end of 1925 have grown to by the end of 2014? (Hint Use the actual returns from 1926 to 1989 and then continue the growth at the assumed rate.) C. Do the same for small stocks. a. Calculate the arithmetic average return on the S&P 500 from 1926 to 1989. The arithmetic average return of the S&P 500 from 1926 to 1989 is (Round to two decimal places.)