Question
Youve observed the following returns on Doyscher Corporations stock over the past five years: 29.1 percent, 16.4 percent, 35.8 percent, 3.7 percent, and 22.7 percent.
Youve observed the following returns on Doyscher Corporations stock over the past five years: 29.1 percent, 16.4 percent, 35.8 percent, 3.7 percent, and 22.7 percent. The average inflation rate over this period was 3.37 percent and the average T-bill rate over the period was 4.3 percent.
1) What was the average real return on the stock? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
2) What was the average nominal risk premium on the stock? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
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