You’ve observed the following returns on Crash-n-Burn Computer’s stock over

Question: You’ve observed the following returns on Crash-n…

You’ve observed the following returns on Crash-n-Burn Computer’s stock over the past five years: 5 percent, -14 percent, 26 percent, 22 percent, and 16 percent. The average inflation rate over this period was 3.2 percent and the average T-bill rate was 5.25 percent.

Requirement 1: What was the average real return on Crash-n-Burn’s stock? ________ (Do not round intermediate calculations.)

Requirement 2: What was the average nominal risk premium on Crash-n-Burn’s stock? ________ (Do not round intermediate calculations.)

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jagguarpaw January 11, 2017 0 Comments