Common stocks and treasury billis for four different periods

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a. Here are the average rates of return for common stocks and Treasury billis for four different periods. What was the risk premium on stock for each of these periods?

1900-1924  1925-1949     1950-1974   1975-2010

Stocks 9.50%    10.20%             11.10%         13.70%

Treasury bills 5.10%     1.10%                3.50%           5.60%

b. What securities do the historical records show bond performances are typically against?

Reference no: EM131500751

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