What is the annualized holding rate of return and the average rate of return for each of
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What is the annualized holding rate of return and the average rate of return for each of the following?
(a) An asset that returns 5% each year.
(b) An asset that returns 0% and 10% in alternate years.
(c) An asset that returns −10% and 20% in alternate years.
Is the distance between the two returns larger when there is more risk?
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