This is a measure summarizing the overall past performance of an investment. Ave

Question

This is a measure summarizing the overall past performance of an investment. Average return dollar return market return percentage return A 4.5 percent coupon municipal bond has 10 years left to maturity and has a price quote of 97.75. The bond can be called in 4 years. The call permission is 1 year of coupon payments. What is the bonds taxable equivalent yield for an investor in the 33% marginal tax bracket? (Assume interest payments are paid semi-annually and a par value of $5,000.) 4.5% 4.70% 7.13% 14.48% A bond issued by a corporation on May 1, 1999, is scheduled to, mature on May 1, 2019. If today is May 2, 2009, What is this bond time to maturity? (Assume annual payments.) 9 years 10 years 19 years 20 years Compute the standard deviation of Kohl's monthly returns. The past five monthly returns for kohl's are 5.55 percent, 8.62 percent, -4.44 percent, -8.52 percent, and 9.75 percent. 4.92% 5.07% 6.28% 6.12% Suppose that a firm's recent earnings per share and dividends per share are %2.50 and $1.00 respectively. Both are expected to grow at 10 percent. However, the firm's current P/E ratio of 22 seems high for this grown rate. The P/E ratio is expected to fall to 18 within five years. Compute a value for this stock by first estimating the dividends over the next five years and the stock price in five years. The discount these cash flows using a 14 percent required rate. $37.51 $37.64 $42.14

Explanation / Answer

36)

Average return combines all previous returns and divides with the number of years so we will get the average performance of the investment.

Hence, it is called average return

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