The Average Annual Return Over the Period 1886-2006 for Stocks

question 35

Multiple Choice

The average annual return over the period 1886-2006 for stocks that comprise the S&P 500 is 10.5%,and the standard deviation of returns is 18.5%.Based on these numbers,what is a 95% confidence interval for 2007 returns?

• A)-18.5%,18.5%
• B)-10%,10%
• C)-26.5%,47.5%
• D)-37%,37%
• E)-8%,29%

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Definitions:

Revenues

Revenues are the total amount of money received by a company for goods sold or services provided during a specific period.

Expenses

Costs incurred in the process of earning revenue, often categorized into operating and non-operating expenses.

Balance Sheet

An accounting statement that itemizes the total assets, liabilities, and equity of shareholders at a defined date.

Accounts Payable

Liabilities owed by a business to its suppliers or vendors for goods and services purchased on credit.