What is the geometric average of the returns last four year

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Stock A has an expected return of 7% and has a portfolio weight of 25%. Stock B has an expected return of 9% and has a portfolio weight of 50%. Stock C has an expected return of 8% and has a portfolio weight of 25%.

a) What is the expected portfolio return?

b) If the portfolio had returns of 5%, 9%, and 6% the last three years, what is the geometric average of the returns the last four years? (Use your answer in letter “a” for the fourth year).

Reference no: EM131901294

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