Calculate the Equivalent Interest Rate (To the Nearest 0.01%)

question 35

Short Answer

Calculate the equivalent interest rate (to the nearest 0.01%)

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Definitions:

Share

A unit of ownership in a company or financial asset, often traded on a stock exchange.

Arithmetic Average Return

The simple average of a series of returns over a period of time, calculated by summing the returns and dividing by the number of periods.

Jensen's Measure

A performance evaluation measure that calculates the excess return a fund generates over its expected return, given its level of risk.

Risk-Free Return

The theoretical return on an investment with no risk of financial loss, often represented by the yield on government securities such as U.S. Treasury bonds.