1) Return Calculations:
Problem: A particular stock had a return last year of 4 percent. However, you look at the stock price and notice that it actually didnâ??t change at all last year. How is this possible?
2) Returns Distributions:
Problem: What is the probability that the return on small stocks will be less than 100 percent in a single year (think about it)? What are the implications for the distribution of returns?