You’ve observed the following returns on Doyscher Corporation’s stock over the p

Question

You’ve observed the following returns on Doyscher Corporation’s stock over the past five years: –28.5 percent, 16.0 percent, 35.0 percent, 3.5 percent, and 22.5 percent. Requirement 1: What was the arithmetic average return on the stock over this five-year period? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Arithmetic average return % Requirement 2: (a) What was the variance of the returns over this period? (Do not round intermediate calculations. Round your answer to 6 decimal places (e.g., 32.161616).) Variance (b) What was the standard deviation of the returns over this period? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Standard deviation %

Explanation / Answer

Year Return x- return (x-return)^2 1 -28.5 -38.2 1459.24 2 16 6.3 39.69 3 35 25.3 640.09 4 3.5 -6.2 38.44 5 22.5 12.8 163.84 Arithmatic average 9.7% (sum of x-return)^2 2341.3 n 5 Variance (sum of x-return)^2 /n 468.26 standard deviation square root of variance 21.63% Variance 468.26 standard deviation 24.19349086

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