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Youve observed the following returns on Crash-n-Burn Computers stock over the past five years: 18 percent, 14 percent, 20 percent, 22 percent, and 10 percent.
Youve observed the following returns on Crash-n-Burn Computers stock over the past five years: 18 percent, 14 percent, 20 percent, 22 percent, and 10 percent. Suppose the average inflation rate over this period was 3.1 percent and the average T-bill rate over the period was 4.4 percent. a. What was the average real return on Crash-n-Burns stock? b. What was the average nominal risk premium on Crash-n-Burns stock?
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