The geometric average return for year period

Assignment Help Financial Management
Reference no: EM131541243

Suppose a particular investment earns an arithmetic return of 10% in year 1, 20% in year 2 and 30% in year 3. The geometric average return for the year period will be

o greater than the arithmetic average return.

o equal to the arithmetic average return.

o less than the arithmetic average return.

o equal to the market return.

o Cannot tell from the information given

Reference no: EM131541243

Questions Cloud

Research a mine active near where you live : Research a mine (active or abandoned) near where you live. Find at least one article on the mine.
Prolonging an economic downturn : Why may austerity be associated with prolonging an economic downturn?
Create a guide to leveraging expatriates : Examine the major benefits that this report can provide for the organization, and suggest two (2) uses for the information contained therein
Suppose individuals expect a cut in future taxes : Explain what effect this expected reduction in future taxes will have on the yield curve and on stock prices in the current period.
The geometric average return for year period : Suppose a particular investment earns an arithmetic return of 10% in year 1, 20% in year 2 and 30% in year 3. The geometric average return for the year period
Explain the short-run and medium-run : Explain the short-run and medium-run effects of a reduction in productivity. In your graph, clearly label all curves and equilibria.
What is effective financing rate : what is the effective financing rate for a U.S. firm that takes out a one-year, uncovered NZ$ loan?
Determinants of the nominal interest rate : What are the determinants of the nominal interest rate in the medium run? Based on your answer, to what extent can monetary policy affect the nominal interest.
Three steps of financial analysis at organizational level : Explain the three steps of financial analysis at the organizational level? List the four classifications of ratios that the financial statement analysis focuses

Reviews

Write a Review

Financial Management Questions & Answers

  Computer stocks currently provide expected rate of return

Computer stocks currently provide an expected rate of return of 14%. MBI, a large computer company, will pay a year-end dividend of $1 per share. If the stock is selling at $20 per share, what must be the market's expectation of the growth rate of MB..

  Is futures overpriced or underpriced relative to fair value

The current price of silver is $30 per ounce. Assume that the storage cost is zero. The 3-month interest rate is 4% per annum (with continuous compounding). A CME silver futures contract is current trading at $28 (per ounce) will mature in three mont..

  What is the tax savings if residence is aquired

Jessica and Greg are married and file a joint return. What is the tax savings if residence is aquired?

  Calculate total fees you will pay on this loan commitment

A loan commitment of $4.32 million has an upfront fee of 80 basis points and a back end fee of 50 basis points. The take down on the loan is 60%. Calculate the total fees you will pay on this loan commitment.

  Calculate payback period and internal rate of return (irr)

Company has an opportunity to make an investment with the estimated after tax cash flows

  Terms has the highest cost of giving up the cash discount

Which of the following terms has the highest cost of giving up the cash discount, assuming a 365-day year?

  Describe the role of the firms tax rate in cost of capital

How is the fun's weighted cost of capital influenced by the firm's capital structure and describe the role of the firm's tax rate in cost of capital calculations?

  Consist entirely of current assets and net plant-equipment

The assets of "Sample Company" consist entirely of current assets and net plant and equipment. The firm has total assets of $ 4,086,793 and net plant and equipment of $ 1,556,227. The company has notes payable of $ 135,941, long-term debt of $ 539,69..

  Consider binomial model

Consider a binomial model S(0) = 100 and r = .001 and two possible return values m1 = .005 and m2 = −.003. Find the value of a European call with expiry time at step 50 and strike price X = 105. Use the Gaussian approximation of the binomial distribu..

  What is the company target debt–equity ratio

Fama’s Llamas has a WACC of 10.3 percent. The company’s cost of equity is 13.2 percent, and its pretax cost of debt is 8.9 percent. The tax rate is 40 percent. What is the company’s target debt–equity ratio?

  Why is operating leverage important to an organization

Why is operating leverage important to an organization?

  Prefer between the municipal bond and corporate bond

Suppose municipal bond is not state income tax exempt (only federal income tax exempt). Which bond do you prefer between the municipal bond and corporate bond?

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