Walker Enterprises had the following end-of-year stock prices

Question # 00622326 Posted By: katetutor Updated on: 11/27/2017 07:11 AM Due on: 11/27/2017
Subject Finance Topic Finance Tutorials:
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Walker Enterprises had the following end-of-year stock prices over the last five years and paid no dividends.


Time Walker

1 $12

2 9

3 7

4 6

5 8


  • Calculate the average rate of return for each year from the above information.
  • What is the arithmetic average rate of return earned by investing in Walker's stock over this period?
  • What is the geometric average rate of return earned by investing in Walker's stock over this period?
  • Considering the beginning and ending stock prices for the five-year period are the same, which type of average rate of return best describes the annual rate of return earned over the period (arithmetic or geometric)?
  • The annual rate of return at the end of year 3 is what percent?
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  1. Tutorial # 00621059 Posted By: katetutor Posted on: 11/27/2017 07:11 AM
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