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    Geometric Mean (example question)

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    Geometric Mean (example question)

    The prices of five computer stocks increased by 37.2 %, 1,140.0 %, 2.7 %, 842.0% and 0.95 %, respectively since 1990. Compute the geometric mean rate of return for the five stocks.

    (Hint: First convert percents to decimal equivalent)

    © BrainMass Inc. brainmass.com October 9, 2019, 3:50 pm ad1c9bdddf
    https://brainmass.com/economics/econometrics/geometric-mean-example-question-14626

    Solution Preview

    Formula for the geometric mean rate of return is given by:
    <br>
    <br>geometric mean rate of return
    <br>= [[(1+R1)x(1+R2)x(1+R3)x...x(1+Rn)]^(1/n) ...

    Solution Summary

    Geometric Mean example question is dissected.

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