The Historical Returns for the Past Three Years for Stock

question 44

Multiple Choice

The historical returns for the past three years for Stock B and the stock market portfolio are Stock B: 24 percent, 0 percent, 24 percent; market portfolio: 10 percent, 12 percent, 20 percent. Calculate the average return for Stock B and the market portfolio.

• A)Stock B: 16 percent; market portfolio: 14 percent
• B)Stock B: 14 percent; market portfolio: 16 percent
• C)Stock B: 24 percent; market portfolio: 12 percent
• D)Stock B: 12 percent; market portfolio: 16 percent

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Definitions:

Price Level

The current generalized average price of the economy's goods and services.

Money Market

A sector of the financial market where participants borrow and lend short-term, high-quality debt securities.

Money Supply

The total amount of monetary assets available in an economy at a specific time, including cash, currency, and certain types of bank deposits.

Price Level

A measure of the average prices of goods and services in an economy at a specific time, often tracked through indices like the CPI.