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Based on Past 23 Years,Westerfield Industrial Supply's Common Stock Has

Question 12

Multiple Choice

Based on past 23 years,Westerfield Industrial Supply's common stock has yielded an arithmetic average rate of return of 10.5 percent.The geometric average return for the same period was 8.57 percent.What is the estimated return on this stock for the next 4 years according to Blume's formula?


A) 8.70 percent
B) 8.92 percent
C) 9.13 percent
D) 9.38 percent
E) 10.24 percent

Correct Answer:

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