The harmonic mean of 3, 4, and 5 is:

A. 3.74.

B. 3.83.

C. 4.12.

Answer: B

Which of the following is most accurate regarding a distribution of returns that has a mean greater than its median?

A. It is positively skewed.

B. It is a symmetric distribution.

C. It has positive excess kurtosis.

Answer: A

A distribution of returns that has a greater percentage of small deviations from the mean and a greater percentage of extremely large deviations from the mean compared to a normal distribution:

A. is positively skewed.

B. has positive excess kurtosis.

C. has negative excess kurtosis.

Answer: B

The annual returns for FJW's common stock over the years 2003, 2004, 2005, and 2006 were 15%, 19%, -8%, and 14%.

1. What is the arithmetic mean return for FJW's common stock?

A. 10.00%.

B. 14.00%.

C. 15.25%.

2. What is the geometric mean return for FJW's common stock?

A. 9.45%.

B. 14.21%.

C. It cannot be determined because the 2005 return is negative.'

Answer: 

1. A

(15% + 19% + (-8%) + 14%) / 4 = 10%

2. A

(1.15 x 1.19 x 0.92 x 1.14)0-25- 1 = 9.45%