What is the geometric average return of the following quarterly returns: 3%, 5%, 4%, and 7%?
A. 3.72%
B. 4.23%
C. 4.74%
D. 4.90%
Answer: C. 4.74%
Return = (1.03 × 1.04 × 1.05 × 1.07).25 - 1 = .0474
What is the geometric average return of the following quarterly returns: 3%, 5%, 4%, and 7%?
A. 3.72%
B. 4.23%
C. 4.74%
D. 4.90%
Answer: C. 4.74%
Return = (1.03 × 1.04 × 1.05 × 1.07).25 - 1 = .0474