【正文】 urns than longterm corporate bonds. d. the risk premium on longterm corporate bonds has exceeded the risk premium on longterm government bonds. e. the risk premium on large pany stocks has exceeded the risk premium on small pany stocks.HISTORICAL RECORDe 23. Over the period of 1926 through 2003, the annual rate of return on _____ has been more volatile than the annual rate of return on_____: a. large pany stocks。 small pany stocks. b. longterm government bonds。 longterm corporate bonds. c. . Treasury bills。 longterm government bonds. d. longterm corporate bonds。 small pany stocks. e. large pany stocks。 longterm corporate bonds.HISTORICAL RECORDd 24. During the period of 1926 through 2003 the annual rate of inflation: a. was always positive. b. was only negative during the 3 years of the Great Depression. c. never exceeded 10 percent. d. fluctuated significantly from one year to the next. e. tended to be negative during the years of World War II.HISTORICAL RECORDe 25. Based on the period of 1926 through 2003 the annual rate of inflation ranged from _____ percent to _____ percent. a. 5。 6 b. 5。 9 c. 7。 6 d. 7。 15 e. 10。 18HISTORICAL RECORDb 26. $1 invested in . Treasury bills in 1926 would have increased in value to ____ by 2003. a. $10 b. $17 c. $30 d. $43 e. $60HISTORICAL RECORDd 27. Which one of the following is a correct ranking of securities based on their volatility over the period of 1926 to 2003? Rank from highest to lowest. a. large pany stocks, . Treasury bills, longterm government bonds b. small pany stocks, longterm corporate bonds, large pany stocks c. small pany stocks, longterm government bonds, longterm corporate bonds d. large pany stocks, longterm corporate bonds, longterm government bonds e. longterm government bonds, longterm corporate bonds, . Treasury billsHISTORICAL RECORDd 28. $1 invested in small pany stocks in 1926 would have increased in value to _____ by 2003. a. $60 b. $2,284 c. $4,092 d. $10,953 e. $13,185HISTORICAL RECORDd 29. The highest rate of annual inflation between 1926 and 2003 was_____ percent. a. 7 b. 10 c. 13 d. 18 e. 22HISTORICAL RECORDe 30. The annual return on longterm government bonds has ranged between _____ percent and _____ percent during the period 1926 to 2003. a. 2。 8 b. 4。 6 c. 5。 10 d. 6。 29 e. 7。 44HISTORICAL RECORDe 31. Over the period of 1926 to 2003, small pany stocks had an average return of _____ percent. a. b. c. d. e. HISTORICAL AVERAGE RETURNSc 32. Over the period of 1926 to 2003, the average rate of inflation was _____ percent. a. b. c. d. e. HISTORICAL AVERAGE RETURNSc 33. The average annual return on longterm corporate bonds for the period of 1926 to 2003 was _____ percent. a. b. c. d. e. AVERAGE RETURNSb 34. The average annual return on small pany stocks was about _____ percent greater than the average annual return on largepany stocks over the period of 1926 to 2003. a. 3 b. 5 c. 7 d. 9 e. 11RISK PREMIUMa 35. The average risk premium on . Treasury bills over the period of 1926 to 2003 was _____ percent. a. b. c. d. e. RISK PREMIUMa 36. Which one of the following is a correct statement concerning risk premium? a. The greater the volatility of returns, the greater the risk premium. b. The lower the volatility of returns, the greater the risk premium. c. The lower the average rate of return, the greater the risk premium. d. The risk premium is not correlated to the average rate of return. e. The risk premium is not affected by the volatility of returns.RISK PREMIUMc 37. The risk premium is puted by ______ the average return for the investment. a. subtracting the inflation rate from b. adding the inflation rate to c. subtracting the average return on the . Treasury bill from d. adding the average return on the . Treasury bill to e. subtracting the average return on longterm government bonds fromRISK PREMIUMc 38. The excess return you earn by moving from a relatively riskfree investment to a risky investment is called the: a. geometric average return. b. inflation premium. c. risk premium. d. time premium. e. arithmetic average return.RISK PREMIUMb 39. To convince investors to accept greater volatility in the annual rate of return on an investment, you must: a. decrease the risk premium. b. increase the risk premium. c. decrease the expected rate of return. d. decrease the riskfree rate of return. e. increase the riskfree rate of return.FREQUENCY DISTRIBUTIONa 40. Which one of the following takes the shape of a bell curve? a. frequency distribution b. variance c. risk premium graph d. standard deviation e. deviation of returnsVARIANCEe 41. Which of the following statements are correct concerning the variance of the annual returns on an investment? I. The larger the variance, the more the actual returns tend to differ from the average return. II. The larger the variance, the larger the standard deviation. III. The larger the variance, the greater the risk of the investment. IV. The larger the variance, the higher the expected return. a. I and III only b. II, III, and IV only c. I, III, and IV only d. I, II, and III only e. I, II, III, and IVVARIANCEa 42. The variance of returns is puted by dividing the sum of the: a. squared deviations by the number of returns minus one. b. average returns by the number of returns minus one. c. average returns by the number of returns plus one. d. squared deviations by the average rate of return. e. squared deviations by the number of returns plus one.STANDARD DEVIATIONb 43. Which of the following statements concerning the standard deviation are correct? I. The greater the standard deviation, the lower the risk. II.