The information gives sample average returns and the sample standard deviations of returns on four portfolios and inflat

[answerhappygod]

The Information Gives Sample Average Returns And The Sample Standard Deviations Of Returns On Four Portfolios And Inflat 1 (220.24 KiB) Viewed 26 times

The information gives sample average returns and the sample standard deviations of returns on four portfolios and inflation for the time period from 1926-2020. The series are as follows: Small-company stocks is the return on the smallest decile of NYSE stocks; Large company returns are returns on the S&P 500 and then the largest decile of NYSE/NASDAQ stocks; long-term government bonds (20-year constant maturity portfolio of U. S. Treasury bonds); U.S. Treasury Bill (3-month maturities); Inflation based on CPI. Series Small-company stocks Large-company stocks Long-term government bonds U.S. Treasury Bills Inflation Arithmetic Average Return 16.2% 12.2% 6.1% 3.3% 2.9% Standard Deviation of Returns 31.3% 19.7% 9.8% 3.1% 4.0% a. (3 points) What has been the average risk premium on long-term government bonds over the 1926-2020 period? b. (3 points) What has been the average real rate of return on small-company stocks over the 1926-2020 period?