answer finance questions

Answer the following questions.

;1.What is the arithmetic average of 12%, 14%, -20% (that’s negative 20) and 10%? ; What is the geometric average? ;

2. The S&P 500 Index had the following annual returns:

2010: 12.78 ; ; ;2011: 0.00 ; ; 2012: 13.41 ; ; 2013: 29.6 ; ; 2014: 11.39

Using just these last 5 years of data, what is the expected return for the Dow Jones? ; B. What is the standard deviation of the returns? (Please explain each step of the formula)

3. ;You are considering investing in 8 companies by purchasing their stock today. Answer the following:

A.

If markets are strong form efficient, would the expected return on your friend’s investment be greater than the overall stock market return? ;

;B

What is a difference between the strong form of the efficient market hypothesis and the weak form?