QUESTION 2The following table contains data on the returns of stock A and stock B from 2021 to 2024:Year2021202220232024Return on stock A681012Return on stock B131014111. Compute the mean return on stock A and the mean return on stock B;2. Compute the variance of the return on stock A and the variance of the return on stock B;8. Compute the standard deviation of the return on stock A and the standard deviation of thereturn on stock B;4. Compute the coefficient of variation of the return on stock A and stock B;5. Compute RRC for stock A and stock B (Hint: RRC = Mean Return/Standard Deviation);6. Would you invest in Stock A or Stock B? Why?

YearsStock AStock B202161320228102023101420241211

QUESTION 2 The following table contains data on the returns of stock A and stock B from 2021 to 2024: Year 2021 2022 2023 2024 Return on stock A 6 8 10 12 Return on stock B 13 10 14 11 1. Compute the mean return on stock A and the mean return on stock B; 2. Compute the variance of the return on stock A and the variance of the return on stock B; 3. Compute the standard deviation of the return on stock A and the standard deviation of the return on stock B; 4. Compute the coefficient of variation of the return on stock A and stock B; 5. Compute RRC for stock A and stock B (Hint: RRC 6. Would you invest in Stock A or Stock B? Why? Mean Return/Standard Deviation);

QUESTION 2 The following table contains data on the returns of stock A and stock B from 2021 to 2024: Year 2021 2022 2023 2024 Return on stock A 6 8 10 12 Return on stock B 13 10 14 11 1. Compute the mean return on stock A and the mean return on stock B; 2. Compute the variance of the return on stock A and the variance of the return on stock B; 3. Compute the standard deviation of the return on stock A and the standard deviation of the return on stock B; 4. Compute the coefficient of variation of the return on stock A and stock B; 5. Compute RRC for stock A and stock B (Hint: RRC 6. Would you invest in Stock A or Stock B? Why? Mean Return/Standard Deviation);

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 17P

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