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Over a 30-Year Period an Asset Had an Arithmetic Return

Question 94

Multiple Choice

Over a 30-year period an asset had an arithmetic return of 13 percent and a geometric return of 10.5 percent.Using Blume's formula,what is your best estimate of the future annual returns over the next 5 years?


A) 11.18 percent
B) 12.27 percent
C) 11.84 percent
D) 12.66 percent
E) 12.46 percent

Correct Answer:

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