Calculate the arithmetic average returns

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Reference no: EM131060655

Suppose we have the following returns for large-company stocks and Treasury bills over a six year period: Year Large Company US Treasury Bill 1 3.89 5.81 2 14.14 2.47 3 19.13 3.70 4 –14.55 7.13 5 –32.04 5.18 6 37.37 6.16 a. Calculate the arithmetic average returns for large-company stocks and T-bills over this period. Calculate the standard deviation of the returns for large-company stocks and T-bills over this period. Calculate the observed risk premium in each year for the large-company stocks versus the T-bills. What was the standard deviation of the risk premium over this period?

Reference no: EM131060655

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