You’ve observed the following returns on Barnett Corporation’s stock over the pa

Question

You’ve observed the following returns on Barnett Corporation’s stock over the past five years: –29.4 percent, 16.6 percent, 36.2 percent, 3.8 percent, and 22.8 percent.

What was the arithmetic average return on the stock over this five-year period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
  
Arithmetic average return             %

What was the variance of the returns over this period? (Do not round intermediate calculations and round your answer to 6 decimal places, e.g., 32.161616.)
  
Variance            
  
What was the standard deviation of the returns over this period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
  
Standard deviation            

Explanation / Answer

arithmetic average return=Total return/Total time period

=(-29.4+16.6+36.2+3.8+22.8)/5

=10%

Standard deviation=[Total (Return-Mean)^2/(Time Period-1)]^(1/2)

=[2484.64/(5-1)]^(1/2)

=(2484.64/4)^(1/2)

=24.92%(Approx)

Variance=Standard deviation^2

=0.062116

Return (Return-Mean)^2 -29.4 (-29.4-10)^2=1552.36 16.6 (16.6-10)^2=43.56 36.2 (36.2-10)^2=686.44 3.8 (3.8-10)^2=38.44 22.8 (22.8-10)^2=163.84 Total=2484.64%

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