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Average Annual Rates Standard Deviation T-Bills ...

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Finance

Average Annual Rates Standard Deviation
T-Bills Inflation Real T-Bill T-Bills Inflation Real T-Bill
Full sample 3.38 2.15 0.46 3.12 4.00 3.76
19271951 0.95 1.79 0.47 1.24 6.04 6.33
19522018 4.26 3.46 0.81 3.13 2.89 2.12

(1927-2018) Market Index Big/ Growth Big/ Value Small/ Growth Small/ Value
Mean excess return (annualized) 8.29 8.07 11.69 8.99 15.38
Standard deviation (annualized) 18.52 18.35 24.70 26.06 28.21

Suppose that the inflation rate is expected to be 2.15% in the near future using the data provided above, what would be your predictions for the following? (Round your answers to 2 decimal places.)

A ; The T bill rate

B. The expected rate of return of the big value portfolio

c. The risk premium on the stock market

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