You Have Calculated the Historical Dollar-Weighted Return, Annual Geometric Average

question 17

Multiple Choice

You have calculated the historical dollar-weighted return, annual geometric average return, and annual arithmetic average return. If you desire to forecast performance for next year, the best forecast will be given by the ________.

• A) dollar-weighted return
• B) geometric average return
• C) arithmetic average return
• D) index return

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Definitions:

Foreign Currency

Currency of another country, used to conduct international transactions or investments.

Forward Market

A marketplace for the exchange of financial instruments or commodities for delivery in the future at prices agreed upon today.

Spot Market

A public financial market in which financial instruments or commodities are traded for immediate delivery.

Communications Technology

The branch of technology that deals with the transmission of information through digital or analog means.