The Mean and Standard Deviation (SD)of Monthly Returns,over a Given

question 27

Multiple Choice

The mean and standard deviation (SD) of monthly returns,over a given period of time,for the stock markets of two countries,X and Y are: $$\begin{array} { c c c } \text { Country } & \begin{array} { l } \text { Mean } \\( \% ) \end{array} & \begin{array} { c } \text { SD } \\( \% ) \end{array} \\\hline \text { X } & 1.57 & 4.87 \\\text { Y } & 1.92 & 7.64\end{array}$$ Assuming that the monthly risk-free interest rate is 0.25%,the Sharpe performance measures,SHP(X) and SHP(Y) ,and the performance ranks,respectively,for X and Y are: (Don't round intermediate calculations and Round your final answers to 3 decimal places.)

• A) SHP(X) = 0.271, rank = 1, and SHP(Y) = 0.219, rank = 2
• B) SHP(X) = 0.271, rank = 2, and SHP(Y) = 0.219, rank = 1
• C) SHP(X) = 18.84, rank = 1, and SHP(Y) = 23.04, rank = 2
• D) SHP(X) = 23.04, rank = 2, and SHP(Y) = 18.84, rank = 1

---

Definitions:

Highball Technique

A strategy often used in negotiations where an extremely high initial offer is made to reset the negotiation boundaries.

Attributional Tendencies

The habitual ways a person explains the causes of their own and others' behaviors and events.

External Causes

Factors outside an individual that can influence their behavior or actions, such as environmental, social, or economic conditions.

Internal Causes

Factors within an individual, such as personal beliefs, attitudes, or emotions, that can influence their behavior or outcomes.