Use the following Average Return and Standard Deviation numbers for each of the asset classes...
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Accounting
Use the following Average Return and Standard Deviation numbers for each of the asset classes below to calculate the range of one standard deviation from the mean for each asset class. To provide an example, the range has been calculated for Large Corporate Stocks.
Average Standard
Asset Class Return Deviation Range
Large Company Stocks 11.9% 20.4% (8.5)% to 32.2%
Small Company Stocks 16.7 32.6 ___________
Long-term Corporate Bonds 6.2 8.3 ___________
Long-term Government Bonds 5.9 9.5 ___________
Intermediate-term Govt. Bonds 5.5 5.7 ___________
U.S. Treasury Bills 3.7 3.1 ___________
Inflation Rate 3.1 4.2 ___________
Using the information in the previous problem, what is the risk premium for Long-term Corporate Bonds?
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