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# \$5.00Finance 100 - Financial Return & Risk Co

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• Due on Mar. 03, 2012
• Asked on Mar 01, 2012 at 9:37:54PM

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Finance 100 - Financial Return & Risk Concepts

I am having some difficulties trying to figure out the following proglems - I am nervous to go to class Monday and not understand how to do them (incase of quiz) - PLEASE HELP!!!

1) From the information below, compute the average annual return, the variance, standard deviation, and coefficient of variation for each asset.

a) 5%, 10%, 15%, 4%

b) -6%, 20%, 2%, -5%, 10%

c) 12%, 15%, 17%

d) 10%, -10%, 20%, -15%, 8%, -7%

- Based upon your answers to question 1, which asset appears riskiest based on standard deviation? Based on coefficient of variation?

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• Posted on Mar 01, 2012 at 10:07:03PM
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A:
Preview: ... an  =  9.765 / 4.2 = 2.325   c)       annual average return = (12 + 15 + 17)/3 = 44/3 % = 14.67 %       mean = 44 /3= 14.67        variance = ((-2.67)^2 + (0.33)^2 + (2.33)^2 )/3 = 4.22       standard deviation =  (4.22)^(1/2) =2.055       coefficient of variation = s.d./mean  =  2.055 / 14.67 = 0.14 d)       ...

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• Posted on Mar 01, 2012 at 11:19:52PM
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