The Arithmetic Average Return Is The

question 88

Multiple Choice

The arithmetic average return is the:

• A)summation of the returns for a number of years, t, divided by (t − 1).
• B)compound total return for a period of years, t, divided by t.
• C)average compound return earned per year over a multi-year period.
• D)average squared return earned in a single year.
• E)return earned in an average year over a multi-year period.

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Definitions:

Voting Stock

Shares that give the shareholder the right to vote on matters of corporate policy and the election of the board of directors.

Foreign Corporation

A company that is incorporated under the laws of a country different from the country of its primary operations.

Inventory

The total amount of goods and materials held by a business for the purpose of sale or production, including raw materials, work-in-process, and finished goods.

Consolidated Income Tax Return

A single income tax return filed by a parent company that includes all incomes, deductions, and credits of all members of a corporate group.