Question

Year Returns X Y 12% 18% 26 12 10 - 19 -24 10 18 2 3 4 5 27 Using the returns shown above, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y. (Do not round intermediate calculations. Enter your average return and standard deviation as a percent rounded to 2 decimal places, e.g., 32.16, and round the variance to 5 decimal places, e.g., .16161.) & Answer is complete but not entirely correct. X % % Average returns Variances 8.20 2.72200 16.50 9.80 3.932038 19.83 Standard deviations % %

Answer 1

Return 0.038 Return-Expected Return Deviation deviation^2 0.12 0.26 0.178 0.038 -0.19 -0.272 0.1 0.018 0.41 0.12 0.001444 0.031684 0.001444 0.073984 0.000324 0.108880 8.20% 0.02722! 16.50% Expected return Variance Standard deviation 0.35/5 0.108880/4 0.02722^(1/2) Year Return Return-Expected Return Deviation deviation^2 0.18 0.098 0.271 0.188 0.1 0.018 -0.24 -0.322 0.18 0.098 0.49 0.009604 0.035344 0.000324 0.103684 0.009604 0.158560 9.80% 0.03964 19.91% Expected return Variance Standard deviation 0.12/5 0.158560/4 0.03964^(1/2)