Details of this Paper

Finance Homework Problems

Description

solution


Question

Question;Q.1.You bought a share of 3 percent preferred stock for $96.67 last year. The market price for your stock is now $98.43What was your total return for last year? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))Total return %;Q2. You?ve observed the following returns on Mary Ann Data Corporation?s stock over the past five years: 10 percent, ?10 percent, 17 percent, 22 percent, and 10 percent. Suppose the average inflation rate over this period was 1.5 percent and the average T-bill rate over the period was 3.0 percent.;What was the average real risk-free rate over this time period? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16));Average real risk-free rate %;What was the average real risk premium? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16));Average real risk premium %;Q3.Consider the following rates of return;Year Large Company US Treasury Bill1 3.99 % 6.65 %2 14.50 4.463 19.39 4.334 ?14.29 7.345 ?31.78 5.446 37.10 6.45________________________________________Calculate the standard deviation of the returns for large-company stocks and T-bills over this period.(Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16));Standard deviationLarge company stocks %;T-bills %;c-1 Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the arithmetic average risk premium over this period? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16));Average risk premium %;c-2 Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the standard deviation of the risk premium over this period? (Round your answer to 2 decimal places. (e.g., 32.16));Standard deviation %;Q4.;Returns Year X Y 1 13 % 18 % 2 27 28 3 ? 20 ? 25 4 8 10 5 10 19 ________________________________________Using the returns shown above, calculate the average returns, the variances, and the standard deviations for X and Y (Do not round intermediate calculations and round your final percentage answer to 2 decimal places. (e.g., 32.16) and variances to 5 decimal places. (e.g., 32.16161))X YAverage returns % %;Variances;Standard deviations % %

 

Paper#50209 | Written in 18-Jul-2015

Price : $22
SiteLock