Question
Youve observed the following returns on Barnett Corporations stock over the past five years: 29.7 percent, 16.8 percent, 36.6 percent, 3.9 percent, and 22.9 percent.
Youve observed the following returns on Barnett Corporations stock over the past five years: 29.7 percent, 16.8 percent, 36.6 percent, 3.9 percent, and 22.9 percent. The average inflation rate over this period was 3.39 percent and the average T-bill rate over the period was 4.3 percent. a. What was the average real return on the stock? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Average real return ______% b. What was the average nominal risk premium on the stock? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Average nominal risk premium _______%
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