Over the Past Four Years, the Common Stock of JL

question 63

Multiple Choice

Over the past four years, the common stock of JL Steel Co. produced annual returns of 7.2, 4.8, 10.2, and 12.6 percent, respectively. 3.2, 3.4, 4.2, and 4.5 percent, respectively. What is the standard deviation of the risk premium on JL Steel Co. stock for this time period?

• A) 2.23 percent
• B) 2.86 percent
• C) 3.29 percent
• D) 4.46 percent
• E) 4.61 percent

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Definitions:

Descriptive Economics

The branch of economics that focuses on describing the economies or economic events.

Post Hoc, Ergo Propter Hoc

A logical fallacy that suggests that if one event follows another, the first event must have caused the second.

Fallacy

A mistaken belief, especially one based on unsound argument or reasoning.

Inductive Reasoning

A method of reasoning in which general conclusions are drawn from specific observations or instances.