The closing stock price for Firm A on Dec 31 of the last four years was: 1996 = 20; 1997 = 24; 1998 = 16; 1999 = 32. Firm A does not pay dividends.
a. Calculate the Holding Period Return (HPRs) for the three period: 1996-97; 1997-98; and, 1998-99?
b. Calculate the arithmetic mean of the three HPRs.
c. Calculate the geometric mean return of the three HPRs.
d. If you invested $10,000 on 12/31/1996, what would be the value of your investment on 12/31/1999?