The Average Compound Return Earned Per Year Over a Multi-Year

question 82

Multiple Choice

The average compound return earned per year over a multi-year period when inflows and outflows are considered is called the:

• A) total return.
• B) average capital gains yield.
• C) dollar-weighted average return.
• D) arithmetic average return.
• E) geometric average return.

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Definitions:

Incentive Programs

Schemes designed to motivate and reward desired behaviors or performance from individuals or groups.

State of Nature

A term used in decision theory referring to the actual but possibly unknown status of the world, which affects the outcomes of decisions.

Opportunity Loss

The cost of the next best alternative foregone as a result of making a decision.

Actual Profit

The realised gain from business operations or investments, after all costs and expenses have been deducted.