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The geometric return on an asset over the past 12 years has been 14.50 percent. The arithmetic return over the same period was 14.96 percent. What is the best estimate of the average return on this asset over the next 5 years?

Respuesta :

emaduet2012

Answer:

The Average return on this asset over the next 5 years = 14.79 percent

Explanation:

using below mentioned calculation :

=((5-1)/(12-1) * 0.145) + ((12-5)/(12-1)*0.1496)

=0.1479  or 14.79%.

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