Step by step with provided answers. What is the formula step by step? Thank you so...

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Finance

Step by step with provided answers. What is the formula step bystep? Thank you so much.
10. Given annual returns of 14%, 8%, -10% and 4%, what is thegeometric average?
           = 3.61%

11. What is the arithmetic average of the returns in question10?
           = 4.00%

12. What is the standard deviation of the returns in question10?
           = 10.20%

16. Moi International wants to issue 20-year, zero coupon bondsthat yield 5 percent.   What price should they charge forthese bonds if they have a par value of $1,000? Assume annualcompounding.
= $376.89

17. A stock has an expected return of 15%. The risk-free rate is3%, and the market risk premium is 8%. What is the beta for thisstock?
       =     1.50

18. The beta of the overall market is _ and the beta of arisk-free security of is _.
       =     1; 0.

19. The stock of RWC has a beta of 1.28. The expected return onthe market is 8 percent and the risk-free rate is 1.5 percent. Whatis the expected return on this stock?
        =9.82 percent
Wentworth Inc. has bonds on the market with 22 years tomaturity, face value of $1,000, YTM of 4.2%, and an annual couponrate of 6%. The bonds make semiannual coupon payments. What is thecurrent price of the bond?
=Bond price $1,256.82
Wentworth Inc. also has common stock that trades actively. Thestockholders just received a dividend of $1.00 a share. Thedividend is expected to increase by 40% for the next 2 years andthen the firm expects to maintain a constant dividend growth rateof 5 percent per year.   The required return is 9percent.
a. What are the expected dividends inyears 1 and 2?
=D1 = $1.40, D2 = 1.9
b. What would you be willing to payfor this stock today?
=P0 = $46.24

Answer & Explanation Solved by verified expert

4.1 Ratings (608 Votes)

10 Given R1 014 R2 008 R3 010 R4 004 Geometric Return 1R11R21Rn1n 1 101410081010100414 1 00361 or 361 11 Arithmetic Average R1R2Rnn 014 008 010 0044 004 or 4 12 Average Geometric Return G 00361 Standard Deviation R1 G2 R2G2 RnG2n1 014 003612 008 003612 010 See Answer

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Step by step with provided answers. What is the formula step bystep? Thank you so much.10. Given annual returns of 14%, 8%, -10% and 4%, what is thegeometric average? = 3.61% 11. What is the arithmetic average of the returns in question10? = 4.00% 12. What is the standard deviation of the returns in question10? = 10.20% 16. Moi International wants to issue 20-year, zero coupon bondsthat yield 5 percent. What price should they charge forthese bonds if they have a par value of $1,000? Assume annualcompounding.= $376.89 17. A stock has an expected return of 15%. The risk-free rate is3%, and the market risk premium is 8%. What is the beta for thisstock? = 1.50 18. The beta of the overall market is _____ and the beta of arisk-free security of is _____. = 1; 0. 19. The stock of RWC has a beta of 1.28. The expected return onthe market is 8 percent and the risk-free rate is 1.5 percent. Whatis the expected return on this stock? =9.82 percentWentworth Inc. has bonds on the market with 22 years tomaturity, face value of $1,000, YTM of 4.2%, and an annual couponrate of 6%. The bonds make semiannual coupon payments. What is thecurrent price of the bond?=Bond price $1,256.82Wentworth Inc. also has common stock that trades actively. Thestockholders just received a dividend of $1.00 a share. Thedividend is expected to increase by 40% for the next 2 years andthen the firm expects to maintain a constant dividend growth rateof 5 percent per year. The required return is 9percent.a. What are the expected dividends inyears 1 and 2?=D1 = $1.40, D2 = 1.9b. What would you be willing to payfor this stock today?=P0 = $46.24