What Are the Arithmetic and Geometric Average Returns for a Share

question 3

Multiple Choice

What are the arithmetic and geometric average returns for a share with annual returns of 4%, 9%, -6%, and 18%?

• A)5.89%; 6.25%
• B)6.25%; 5.89%
• C)6.25%; 8.33%
• D)8.3%; 5.89%
• E)8.3%; 6.25%

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Definitions:

Output Price

The price at which a product or service is sold in the market.

Demand for Labor

The quantity of workers that employers are willing and able to hire at different wage levels in a given time period, reflecting the need for labor in producing goods and services.

Labor-augmenting

Refers to technological improvements or investments that increase the productivity of labor, allowing workers to produce more output per unit of labor.

Marginal Productivity

The additional output resulting from a one-unit increase in the input of a particular factor of production, while holding other inputs constant.