Lisa Owns a Stock That Has an Average Geometric Return

question 42

Multiple Choice

Lisa owns a stock that has an average geometric return of 11.34 percent and an average arithmetic return of 11.51 percent over the past six years.What average annual rate of return should Lisa expect to earn over the next four years?

• A)11.38 percent
• B)11.41 percent
• C)11.44 percent
• D)11.47 percent
• E)11.51 percent

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Definitions:

Naturalistic Observation

A research method involving the observation of subjects in their natural environment without any manipulation or interference.

Sociocultural Perspective

An approach in psychology that examines how societal and cultural factors influence behaviors and mental processes.

Sociocultural Approach

The view that social and cultural factors may be just as powerful as evolutionary and physiological factors in affecting behavior and mental processing and that these factors must be understood when interpreting the behavior of others.

Systems Theory

An interdisciplinary study of systems in general, with the aim of elucidating principles that can be applied to all types of systems at all nesting levels in all fields of research.