The Geometric Average Daily Return for Grumpy Inc

question 29

Multiple Choice

The geometric average daily return for Grumpy Inc.was 3.0% for this past week.Grumpy's stock was traded at $18.82 when the market closed on Friday.The daily returns for Monday through Thursday are 5.0%, 2.0%, -10.0%, and 8.0%, respectively.What is the opening price of Grumpy on Friday?

• A)$16.68
• B)$16.90
• C)$16.94
• D)$17.11

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Definitions:

Investment Opportunity

A financial investment or asset that has the potential to yield returns or profits.

Residual Income

The income that remains after deducting all required costs of capital from the operating income, used as a performance measure.

Minimum Required Rate

is the lowest return or yield that an investor is willing to accept on an investment, considering the risk involved.

Average Operating Assets

This term refers to the average value of the assets used in the operations of a business over a specific period, usually calculated to assess performance.