Consider the following realized annual returns: Index Realised Return (%) Stock

Question

Consider the following realized annual returns:

Index Realised Return (%)

Stock A Realised Return (%)

23.6

46.3

24.7

26.7

30.5

86.9

9.0

23.1

-2.0

0.2

-17.3

-3.2

-24.3

-27.0

32.2

27.9

4.4

-5.1

7.4

-11.3

The average annual return on the Index from 2000 to 2009 is closest to:

A: 8.75%

B: 4.00%

C: 9.75%

D: 7.10%

Year End

Index Realised Return (%)

Stock A Realised Return (%)

2000

23.6

46.3

2001

24.7

26.7

2002

30.5

86.9

2003

9.0

23.1

2004

-2.0

0.2

2005

-17.3

-3.2

2006

-24.3

-27.0

2007

32.2

27.9

2008

4.4

-5.1

2009

7.4

-11.3

Explanation / Answer

A. 8.75%

Solution:

=(23.6+24.7+30.5+9-2-17.3-24.3+32.2+4.4+7.4)/ 10 = 8.82 which is closer to 8.75%.

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---