Arithmetic return

Assignment Help Financial Management
Reference no: EM131450299

Over a 36-year period an asset had an arithmetic return of 12.3 percent and a geometric return of 10.2 percent. Using Blume’s formula, what is your best estimate of the future annual returns over 5 years? 9 years? 18 years?

Reference no: EM131450299

Questions Cloud

Planning for savings program : A father is now planning a savings program to put his daughter through college. She is 13, she plans to enroll at the university in 5 years
The fed gets their power to influence interest rates from : The Fed gets their power to influence interest rates from. Financial institutions
The first payment to be made a year from today : Six years from today you need $10,000. You plan to deposit $1,600 annually, with the first payment to be made a year from today, in an account that pays 5% effe
With the growing popularity of casual surf print clothing : With the growing popularity of casual surf print clothing, two recent MBA graduates decided to broaden this casual surf concept to encompass a “surf lifestyle f
Arithmetic return : Over a 36-year period an asset had an arithmetic return of 12.3 percent and a geometric return of 10.2 percent.
Regarding credit default swaps except : All of the following statements are true regarding credit default swaps except:
Demand deposit account : When you put $1000 in a demand deposit account, the bank must add the same amount to their reserve account with the Federal Reserve District Bank.
Evaluating new golf practice equipment : Bridgton Golf Academy is evaluating new golf practice equipment. What is the equivalent annual cost (EAC) of this equipment?
What is the yield to call if bond is called at seven years : What is the yield to call if the bond is called at seven years (state as an APR)?

Reviews

Write a Review

Financial Management Questions & Answers

  Describe capital market listing requirements for corporation

Briefly list and describe capital market listing requirements for corporations that who wish to trade on the NYSE?

  What is the market value of debt

Gingle Co. issued 2 different zero-coupon bonds. Bond A is a junior bond with face value $87 million while Bond B is a senior bond with face value $200 million. The maturity of the debt is 1 year from now. What is the market value of debt?

  What is the expected risk premium on the portfolio

You have decided to invest 30 percent in X; 30 percent in Y; and 40 percent in Z. The probability of the state of the economy is Boom 25%; Normal 60%; and, Bust 15%. The rate of return for stock X is Boom .20; Normal .15; and, Bust .00. What is the p..

  What is the net present value of the project

If the company has a 10% after-tax weighted average cost of capital, has a 40% tax rate, and uses straight-line depreciation, what is the net present value of the project?

  Serve to reduce the bank''s interest rate risk

Suppose that your bank currently operates with a DGAP of 2.2 years. Which of the following will serve to reduce the bank's interest rate risk? a. Issue a one year zero coupon CD to a customer and use the proceeds to buy a three year zero coupon Treas..

  Suppose you take out a home equity calculate your installmen

Suppose you take out a home equity of $325,000 for 25 years an an annual interset rate of 3.49 percent, with payments to be made biweekly payments be?

  What rate of interest will you be earning

Your broker offers to sell you a note for $13,250 that will pay $2,345.05 per year for 10 years. If you buy the note, what rate of interest (to the colsest percent) will you be earning?

  Growth rate both bond and common stock are issued

Suppose you’re given with the following information for some assets; a 16-year 3.6%-coupon bond of semi-annual coupon payment with face value as $1,000, a common stock of $3.20 current expected dividend with 2.5% growth rate Both bond and common stoc..

  Discount the projects free cash flows

You are a financial manager at Apple, which has two divisions. One division produces phones and has an asset beta of 2.5; the other division produces cars and has an asset beta of 1.5. Apple finances itself with 100% equity. You are evaluating a new ..

  Complete the cost approach to value

Complete the cost approach to value, assuming that, because the property is new, no depreciation of the structure is required.

  Prepare a simple balance sheet of assets

Assume that Banc One receives a primary deposit of $1 million.- Prepare a simple balance sheet of assets and liabilities for Banc One immediately after the deposit is received.

  Crucial to designing good products and technologies

Understanding users is crucial to designing good products and technologies, and typically requires to use a variety of methods and almost always to use more than one method for any given project. How can a mobile system help long-distance bicyclists ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd