Reading 7: Statistical Concepts and Market Returns - LOS d

答案和详解如下：

16、The arithmetic mean and geometric mean returns of the following series of stock market returns are:

       Arithmetic Mean      Geometric Mean

A)                 8.75%            8.34%

B)                8.90%             8.62%

C)                 8.90%             8.34%

D)                 8.75%             8.62%

The correct answer was A)

(14 + 6 + (-5) + 20) / 4 = 8.75.

((1.14 * 1.06 * .95 * 1.20)^.25 – 1 = 8.34%.

17、Which of the following statements about the arithmetic mean is least accurate?

A)   The arithmetic mean is the only measure of central tendency where the sum of the deviations of each observation from the mean is always zero.

B)   The arithmetic mean of a frequency distribution is equal to the sum of the class frequency times the midpoint of the frequency class all divided by the number of observations.

C)   All interval and ratio data sets have an arithmetic mean.

D)   If the distribution is skewed to the left then the mean will be greater than the median.

The correct answer was D)    

If the distribution is skewed to the left, then the mean will be less than the median.

18、A portfolio is equally invested in Stock A, with an expected return of 6 percent, and Stock B, with an expected return of 10 percent, and a risk-free asset with a return of 5 percent. The expected return on the portfolio is:

A)   7.4%.

B)   8.0%.

C)   7.0%.

D)   6.3%.

The correct answer was C)

(0.333)(0.06) + (0.333)(0.10) + 0.333(.05) = 0.07

19、An investor has the following assets:

§ $5,000 in bonds with an expected return of 8%.

§ $10,000 in equities with an expected return of 12%.

§ $5,000 in real estate with an expected return of 10%.

What is the portfolio's expected return?

A)   10.00%.

B)   10.75%.

C)   11.00%.

D)   10.50%.

The correct answer was D)

Expected return is the weighted average of the individual expected values. The expected return is: [(5,000)*(10.00) + (5,000)*(8.00) + (10,000)*(12.00)] / 20,000 = 10.50 percent.

20、A stock had the following returns over the last five years: 15 percent, 2 percent, 9 percent, 44 percent, 23 percent. What is the geometric mean and arithmetic mean for this stock?

       Geometric       Arithmetic

A)         17.76%           23%

B)         0.18%           23%

C)         0.18%           18.6%

D)         17.76%         18.6%

The correct answer was D)

Geometric mean = [(1.15)(1.02)(1.09)(1.44)(1.23)]^1/5 – 1 = 1.17760 = 17.76%.

Arithmetic mean = (15 + 2 + 9 + 44 + 23) / 5 = 18.6 %.