TheS&P stock index represents a portfolio comprised of 500 large publicly traded companies.
TheS&P stock index represents a portfolio comprised of 500 large publicly traded companies. On December24, 2007, the index had a value of1,410 and on December24, 2008, the index was approximately 862
If the average dividend paid on the stocks in the index is approximately 5.0 percent of the value of the index at the beginning of the year, what is the rate of return earned on the S&P index?
What is your assessment of the relative riskiness of investing in a single stock such as Google compared to investing in theS&P index(recall from Chapter 2 that you can purchase mutual funds that mimic the returns of the index)?
The rate of return earned on theS&P 500 is _________%. (Round to two decimalplaces.)
What is your assessment of the relative riskiness of investing in a singlestock, such asGoogle, compared to investing in theS&P index? (Select the best choicebelow.)A. There is not enough information given to answer this question. B. Ingeneral, investing in theS&P index is riskier than investing in a single stock. C. Ingeneral, investing in a single stock is riskier than investing in theS&P index. D. Ingeneral, investing in a single stock has the same relative riskiness as investing in theS&P index.
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