When interested in rate of return performance of investment

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Reference no: EM131623706

1. A potential investor looks up the historical returns for Capital World Growth and Income Fund. He finds that that as of the November 30, 2012 the 1-year return is 16.14 percent, the 3-year return is 5.65 percent, the 5-year return is -1.14 percent, the 10 year return is 9.80 percent, and the lifetime return is 10.71 percent. These returns are examples of:

A. Capital yield.

B. Income yield.

C. Ex post return.

D. Ex ante return.

2. When interested in the rate of return performance of an investment over time it is best to use:

A. The arithmetic mean.

B. The geometric mean.

C. Either the arithmetic mean or the geometric mean.

D. Neither the arithmetic mean nor the geometric mean.

Reference no: EM131623706

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