Problem 10-24 Using Return Distributions [LO3] Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 7.3 percent and the standard deviation was 8.4 percent. a. What is the probability that your return on this asset will be less than -4.5 percent in a given year? Use the NORMDIST function in Excel to answer this question. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What range of returns would you expect to see 95 percent of the time? (Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c. What range of returns would you expect to see 99 percent of the time? (Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) a. Probablility b. 95% level 99% level 8.00% % % to % : % c. to Consider the following table for an eight-year period: Year 1 2 3 4 5 6 7 8 T-bill return 7.40% 8.59 5.98 5.62 5.56 8.19 10.67 12.65 Inflation 8.60% 12.23 6.83 4.97 6.59 8.91 13.18 12.41 a. Calculate the average return for Treasury bills and the average annual inflation rate (consumer price index) for this period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the standard deviation of Treasury bill returns and inflation over this time period. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c. Calculate the real return for each year. (A negative answer should be indicated by a minus sign. Leave no cells blank - be certain to enter "O" wherever required. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) d. What is the average real return for Treasury bills? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Answer is not complete. a. Treasury bills Inflation rate Treasury bills Inflation rate % % % % b