Problem 10-7 Calculating Returns and Variability [LO 1] Use the following return
ID: 2725460 • Letter: P
Question
Problem 10-7 Calculating Returns and Variability [LO 1] Use the following returns for X and Y. Returns Year X Y 1 22.6 % 28.8 % 2 – 17.6 – 4.6 3 10.6 30.8 4 21.2 – 16.2 5 5.6 34.8 Requirement 1: Calculate the average returns for X and Y. (Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).) Average returns X 8.48 % Y 14.72 % Requirement 2: Calculate the variances for X and Y. (Do not round intermediate calculations. Round your answers to 6 decimal places (e.g., 32.161616).) Variances X .0263 Y .0548 Requirement 3: Calculate the standard deviations for X and Y. (Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).) Standard deviations X 16.23 % Y 23.40 %
Explanation / Answer
Security X Y Year return return 1 22.60% 28.80% 2 -17.60% -4.60% 3 10.60% 30.80% 4 21.20% -16.20% 5 5.60% 34.80% Average return 8.48 14.72 percent Variance 0.0263532 0.054733 standard deviation 16.233669 23.39513 percent