P1. From the information below, compute the average annual return, the variance, standard deviation, and coefficient of variation for each asset.

Asset	Annual Returns
A	5%,10%,15%,4%
B	-6%,20%,2%,-5%,10%
C	12%,15%,17%
D	10%,-10%,20%,-15%,8%,-7%

	Asset A	Asset B	Asset C	Asset D
	5%	-6%	12%	10%
	10%	20%	15%	-10%
	15%	2%	17%	20%
	4%	-5%		-15%
		10%		8%
				-7%
Average	9%	4%	15%	1%
Variance	0.0026	0.0119	0.0006	0.0186
Std. dev	5.07%	10.92%	2.52%	13.65%
Coeff of var.	0.60	2.60	0.17	13.65

P2. Based upon your answers to question 1, which asset appears riskiest based on standard deviation? Based on coefficient of variation?

ASSET D appears the riskiest based in standard & coefficient.

P3. Recalling the definitions of risk premiums in Chapter 8 and using the Treasury bill return in Table 12.4 as an approximation to the nominal risk-free rate, what is the risk premium from investing in each of the other asset classes listed in Table 12.4?

P4. What is the real, or after-inflation, return from each of the asset classes listed in table 12.4?

	Treasury Bill	Treasury Bond	Stocks	Inflation Rate
Annual Ave Return	3.8%	5.4%	11.1%	3.2%
Standard Deviation	3.0%	7.6%	20.4%	4.0%

Our guarantees

Study Acers provides students with tutoring and help them save time, and excel in their courses. Students LOVE us!No matter what kind of essay paper you need, it is simple and secure to hire an essay writer for a price you can afford at StudyAcers. Save more time for yourself. Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Get your paper done by an expert