Over the Past Four Years, Sandstone Quarry Stock Produced Returns

Multiple Choice

Over the past four years, Sandstone Quarry stock produced returns of 12.6, 15.2, 9.8, and 2.7 percent, respectively. For the same time period, the risk-free rate 4.6, 5.2, 3.8, and 3.4 percent, respectively. What is the arithmetic average risk premium on this stock during these four years?

A) 5.13 percent
B) 5.25 percent
C) 5.50 percent
D) 5.83 percent
E) 5.97 percent