1. Empirical evidence suggests that:
managers may profitably speculate in foreign currency.
managers cannot boost stock prices through creative accounting.
financial managers lack any ability to correctly time stock repurchases.
prices may not reflect their true underlying value.
wise accounting choices can impact a firm’s stock price.
2. A stock had returns of 10 percent, -2 percent, 6 percent, and 18 percent over the past four years. What is the standard deviation of these returns?
8.3 percent
8.7 percent
7.8 percent
7.3 percent
6.9 percent