Suppose That a Stock Gave a Realized Return of 20

question 78

Multiple Choice

Suppose that a stock gave a realized return of 20% over a two-year time period and a 10% return over the third year. The geometric average annual return is ________.

• A) 8.28%
• B) 12.43%
• C) 14.08%
• D) 16.57%

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Definitions:

Production Possibilities

The different combinations of goods and services that an economy can produce given its available resources and technology, typically represented by a curve.

International Trade

The exchange of goods and services between countries, allowing economies to grow by specializing in the production of goods they can produce most efficiently.

Quantity Demanded

The total amount of a good or service that consumers are willing to buy at a given price level in a given period.

World Price

The global market price of a commodity, determined by worldwide supply and demand.