You Own a Stock That Has Produced an Arithmetic Average

question 4

Multiple Choice

You own a stock that has produced an arithmetic average return of 8.6 percent over the past five years.The annual returns for the first four years were 16,11,-19,and 3 percent,respectively.What was the rate of return on the stock in year five?

• A) -5.00 percent
• B) 2.75 percent
• C) 6.25 percent
• D) 28.00 percent
• E) 32.00 percent

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Definitions:

Particular Level

A specific value or category of a variable within a research or statistical analysis.

Grouped Frequency Distribution

A representation of data that shows the number of observations within a given interval, helping in understanding the distribution of data points.

Equal Size

A condition often desired in statistical sampling or experimental design where all groups or samples have the same number of observations.

Arbitrarily Intervals

Intervals or ranges that are determined without a specific rule, often chosen based on convenience or subjective judgement.