From a historical perspective (1900-2013), what would you expect to be the approximate return on a diversified portfolio of common stocks in a year that Treasury bills offered 7.5%?
A) 14.3%
B) 12.3%
C) 15.1%
D)16.5%

Name: From a historical perspective (1900-2013), what would you expect to be the approximate return on a diversified portfolio of common stocks in a year that Treasury bills offered 7.5%? A) 14.3% B) 12.3% C) 15.1% D)16.5%
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Quizplus · Accepted Answer

7.5% + 7.6% (historical risk premium on common stocks) = 15.1%

From a Historical Perspective (1900-2013), What Would You Expect to Be