Using the following returns, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y. Year Returns X Y 1 9% 23% 2 27 44 3 16 -6 4 -17 -20 5 18 52 Calculate the arithmetic average return for X. Calculate the arithmetic average return for Y.

Using the following returns, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y. Year Returns X Y 1 9% 23% 2 27 44 3 16 -6 4 -17 -20 5 18 52 Calculate the arithmetic average return for X. Calculate the arithmetic average return for Y.

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter2: Descriptive Statistics

Section: Chapter Questions

Problem 15P: Consider a sample with data values of 53, 55, 70, 58, 64, 57, 53, 69, 57, 68, and 53. Compute the...

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Concept explainers

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.

Question

Using the following returns, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y.

Year	Returns
X	Y
1	9%	23%
2	27	44
3	16	-6
4	-17	-20
5	18	52

Calculate the arithmetic average return for X.

Calculate the arithmetic average return for Y.

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