The Geometric Return on a Stock Over the Past 10

question 72

Multiple Choice

The geometric return on a stock over the past 10 years was 7.9 percent.The arithmetic return over the same period was 8.8 percent.What is the best estimate of the average return on this stock over the next 5 years?

• A) 8.40 percent
• B) 9.05 percent
• C) 9.08 percent
• D) 9.13 percent
• E) 9.47 percent

---

Definitions:

Credibility

The quality of being trusted and believed in, often earned through consistency, reliability, and integrity in one's actions or information.

Professionalism

The conduct, aims, or qualities that characterize or mark a profession or professional person; it often includes expertise, ethics, and dedication.

Passive Sentence

A sentence construction where the subject of the sentence is acted upon by the verb, often obscuring who is performing the action.

Complex Sentence

A sentence that contains an independent clause and at least one dependent clause, conveying more detailed or nuanced information.