What was the average real return on crash-n-burns stock

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Reference no: EM131505124

You’ve observed the following returns on Crash-n-Burn Computer’s stock over the past five years: 13 percent, –8 percent, 16 percent, 16 percent, and 10 percent. Suppose the average inflation rate over this period was 1.5 percent and the average T-bill rate over the period was 5 percent.

a. What was the average real return on Crash-n-Burn’s stock?

b. What was the average nominal risk premium on Crash-n-Burn’s stock?

Reference no: EM131505124

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