The questions are answered but can you please show me the formulas for each and the steps on how to do these problems?
Deviation of these returns?
Average return = (0.1375 - 0.11375 - 0.0489 + 0.1022 + 0.03658 + 0.1117) / 6 = 0.0375 07287 hohtao. 0l = [1/6-1][0.1375-.0375+-0.11375-.0375+-0.0489.0375 +0.1022.0375+0.03658-.0375+0.1117-.03752 0418100 10.00 percent
8. A Treasury Bond has annual returns of 9.22 percent, 15.64 percent, -12.42 percent, and 6.45 and -7.51 percent for the past five years. The arithmetic average of these returns is percent while the geometric average return for the period is percent.
Arithmetic average = (0.0922 + 0.1564 - 0.1242 + 0.0645 - 0.0751) / 5 = 2.28 percent Geometric return = 1.09221.15640.87581.064592492-1 = 1.72 percent
9. Say you invested in a 9.35% percent coupon bond two years ago for $898.67. The face value of the bond is $1.200. The bond sells for $931.36 today. If the inflation rate last year was 9.15 percent, what was your total real rate of return on this investment? Coupon Payment = 0.0935 x 120 = 112. Nominal return = ($931.36 - $898.67 + $112.20) / $898.67 = 0.0776 Real return = [1 + 0.0776 / 1 + 0.0915] - 1 = -1.27 percent
