Louis Owns a Stock That Has an Average Geometric Return

question 22

Multiple Choice

Louis owns a stock that has an average geometric return of 10.50 percent and an average arithmetic return of 11.00 percent over the past six years.What average annual rate of return should Louis expect to earn over the next four years?

• A) 10.38 percent
• B) 10.40 percent
• C) 10.64 percent
• D) 10.70 percent
• E) 10.81 percent

---

Definitions:

Oil

A fossil fuel and a major source of energy, crucial for industries, transportation, and the production of various chemicals and materials.

Civil Rights Movement

A struggle, mainly in the 1950s and 1960s, by African Americans and allies to achieve racial equality and end segregation and discrimination in the United States.

US Foreign Policy

The strategies, plans, and principles that guide the United States' interactions with foreign nations and international bodies.

Earl Warren

An influential American jurist and politician who served as the 14th Chief Justice of the United States, known for landmark decisions on civil rights, including Brown v. Board of Education.