Exam 10: Risk and Return: Lessons From Market History

The long term inflation rate average was 3.2% and you invested in long term corporate bonds over the same period which earned 6.1%. What was the average risk premium you earned?

You have a sample of returns observations for the Malta Stock Fund. The 4 returns are 7.25%,5.6%,12.5%,1.0%. What is the average return and variance of these returns?

The excess return required from a risky asset over that required from a risk-free asset is called the:

The average risk premium on U.S. Treasury bills over the period of 1926 to 2011 was _____%.

A year ago,you purchased 300 shares of IXC Technologies,Inc. stock at a price of $9.03 per share. The stock pays an annual dividend of $.10 per share. Today,you sold all of your shares for $28.14 per share. What is your total dollar return on this investment?

A stock has returns of 3%,18%,-24%,and 16% for the past four years. Based on this information,what is the 95% probability range for any one given year?

A stock had returns of 8%,-2%,4%,and 16% over the past four years. What is the standard deviation of this stock for the past four years?

One year ago,you purchased a stock at a price of $33. The stock pays quarterly dividends of $.60 per share. Today,the stock is worth $35.2 per share. What is the total amount of your dividend income to date from this investment?

You purchased 200 shares of stock at a price of $36.72 per share. Over the last year,you have received total dividend income of $322. What is the dividend yield?

The excess return you earn by moving from a relatively risk-free investment to a risky investment is called the:

The returns on your portfolio over the last 5 years were -5%,20%,0%,10% and 5%. What is the arithmetic average return?

The prices for IMB over the last 3 years are given below. Assuming no dividends were paid,what was the 3-year holding period return? Given the following information: Year 1 return = 10%,Year 2 return = 15%,Year 3 return = 12%.

Over the past five years,a stock produced returns of 14%,22%,-16%,2%,and 10%. What is the probability that an investor in this stock will NOT lose more than 8% nor earn more than 21% in any one given year?

What are the lessons learned from capital market history? What evidence is there to suggest these lessons are correct?

If the expected return on the market is 16%,then using the historical risk premium on large stocks of 8.6%,the current risk-free rate is:

You just sold 200 shares of Langley,Inc. stock at a price of $38.75 a share. Last year you paid $41.50 a share to buy this stock. Over the course of the year,you received dividends totaling $1.64 per share. What is your capital gain on this investment?

Which one of the following types of securities has tended to produce the lowest real rate of return for the period 1926 through 2011?

Over the period of 1926 to 2011,small company stocks had an average return of ____%.

The total annual returns on large company common stocks averaged 12.3% from 1926 to 2011,small company stocks averaged 17.4%,long-term government bonds averaged 5.8%,while Treasury Bills averaged 3.8%. What was the average risk premium earned by long-term government bonds,and small company stocks respectively?

The risk premium is computed by ______ the average return for the investment.