You Have Calculated the Historical Dollar Weighted Return,annual Geometric Average

question 57

Multiple Choice

You have calculated the historical dollar weighted return,annual geometric average return and annual arithmetic average return.You always reinvest your dividends and interest earned on the portfolio.Which method provides the best measure of the actual average historical performance of the investments you have chosen?

• A) Dollar weighted return
• B) Geometric average return
• C) Arithmetic average return
• D) Index return

---

Definitions:

PID Controller

A proportional–integral–derivative controller used in industrial control systems to continuously calculate an error value and apply correction.

Optimum Performance

The most efficient and effective level of functioning of a system or device.

Menu Costs

The costs incurred by firms in order to change their prices, including costs related to printing new menus, re-tagging items, or advertising new prices.