A Stock Had Returns of 6%,13%,-11%,and 17% Over the Past

question 45

Multiple Choice

A stock had returns of 6%,13%,-11%,and 17% over the past four years. What is the geometric average return for this time period?

• A) 4.5%
• B) 5.7%
• C) 6.2%
• D) 7.3%
• E) 8.2%

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Definitions:

Marginal Revenue

The additional income earned from selling one more unit of a good or service.

Competitive Price-Taker

A market participant who accepts the prevailing market prices as given because they have no power to influence those prices due to intense competition.

Marginal Cost

The increase in total cost that arises from producing one additional unit of a product or service.

Profit Maximized

The point at which a firm achieves the highest profit possible, considering the level of output and cost of production.