Module 5 PP - Text Book: Melicher, R. W., &...

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Unformatted text preview: Text Book: Melicher, R. W., & Norton, E. A. (2011). Introduction to finance: Markets, investments, and financial management (14th ed.). Hoboken, NJ: John Wiley & Sons. ISBN-13: 9780470561072. Excel Please 1. From the information below, compute the average annual return, the variance, standard deviation, and coefficient of variation for each asset. ASSET ANNUAL RETURNS A 5%, 10%, 15%, 4% B-6%, 20%, 2%, -5%, 10% C 12%, 15%, 17% D 10%, -10%, 20%, -15%, 8%, -7% 2. Based upon your answers to question 1, which asset appears riskiest based on standard deviation? Based on coefficient of variation? 5. RCMP, Inc. shares rose 10 percent in value last year while the inflation rate was 3.5 percent. What was the real return on the stock? If an investor sold the stock after one year and paid taxes on the investment at a 15 percent tax rate, what is the real after-tax return on the investment? 10. Given her evaluation of current economic conditions, Ima Nutt believes there is a 20 percent probability of 10....
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