Assignment on Investment Returns and Risk Premiums - Business Finance
Explain the differences between the arithmetic return and the geometric return. Include in your explanation what factor determines the difference between arithmetic returns and geometric (compounded) returns. (75–150 words, or 1–2 paragraphs)If you own a stock with volatile returns over a 2-year period, will the average return be higher or lower than the geometric return? Explain why. (75–150 words, or 1–2 paragraphs)Why is it more convenient to display your investment returns in percentage terms rather than dollar terms? (75–150 words, or 1–2 paragraphs)Would a common stock or a corporate bond demand a higher risk premium? Explain why. (75–150 words, or 1–2 paragraphs)What are the differences between a bond risk premium and an equity risk premium? (75–150 words, or 1–2 paragraphs)Explain whether it is possible to earn excess returns without taking on additional risk. (75–150 words, or 1–2 paragraphs)Note: For each prompt, be sure to reference at least one scholarly source to support your answer. Use the Walden Undergraduate Paper Template, provided in this week’s Learning Resources, to complete this Assignment.
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Title of Your Paper, Centered, and Using Both Upper and Lowercase Letters
Your Name Here
Walden University
Instructor’s Name
Course Title and Number
Date
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Center the Title of Your Paper Here
This formatting should be used as a template for all your assignments here at Walden,
unless you have been directed to format your essay differently by your instructor. If you read this
essay carefully and print a copy for your use, it will be a great help as you create your
assignments. Because bachelor’s level students do not write extensive research papers, the
appropriate requirements for your assignments will differ from those for graduate students. Most
of your written assignments will take the form of essays with opening and closing paragraphs, a
clear purpose that is accomplished in the course of the essay, and logically organized paragraphs
that develop your ideas. Please note that the best introductory paragraphs identify a specific topic
or problem, highlight what has been said or done concerning this topic, and offer a new and
significant argument or perspective about the topic. As you construct your introductory
paragraph, remember to engage the reader and to express the purpose you hope to fulfill in the
paper. In addition, the introduction should offer thesis statement, which is usually the last
sentence of your introductory paragraph. A strong thesis is like a roadmap for your readers,
presenting the route you are planning to take in order to hit all of the highlights of your topic. For
more help on how to create a focused thesis statement, make sure to check out
http://academicguides.waldenu.edu/writingcenter/writingprocess/thesisstatements.
This template generally follows APA formatting, but the exceptions are significant. A
number of features appropriate for a long manuscript or for a dissertation are not necessary for
relatively brief assignments. For example, you do not need to provide an abstract or Table of
Contents for every assignment unless your instructor indicates otherwise. Also, note that the
sixth edition of the APA manual allows for first person singular, meaning that you may to
yourself, the singular author of the essay, using the pronouns I, me, and my. However, you may
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not use the first person plural (we, us, our) unless you are referring to yourself and a group of
authors who are writing the assignment.
Throughout your paper, consider the way a paragraph looks on the page. The indentation
and length of a paragraph convey a message to the reader, suggesting a brief or extensively
developed unity of an idea. Two naturally emphatic places in any paragraph are the opening
sentence and the closing sentence. The opening sentence of a paragraph is often called the topic
sentence, which should provide a mini-roadmap for what you plan on discussing in the
paragraph. For a more comprehensive explanation of how to write effective topic sentences,
make sure to review the Writing Center’s information on topic sentences. Take advantage of the
positions of both the opening and closing sentences in a paragraph; use them for emphasis and
for guiding your reader.
Specifically, the opening sentence, or topic sentence, of any paragraph provides a natural
opportunity to direct the reader from one idea to another. The sentence may function as a
combination topic and transition device, suggesting to the reader where this particular section is
headed. You may also use single words or phrases to connect your ideas to one another. Think of
transitional expressions such as the following as glue or signposts: also, in addition, moreover,
therefore, similarly, in contrast, although, or however. For a list of commonly used transition
words and phrases, make sure to review the Writing Center’s resource on transitions and check
out the Writing Center’s blog post on effective transition use. As the author, you have the
responsibility to demonstrate for the reader the relationship between one idea and another so that
the reader never has to guess at the logical organization of your ideas. Notice that I am writing
about organization, and this sentence becomes a bridge to the next paragraph.
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Another way that you might wish to indicate organization to your reader is the use of
headings. However, in many of your assignments, no headings are required. If your paper
exceeds five pages, or if you think that headings will help to convey the organization and clarity
of a particularly complex paper, then consult the Writing Center’s headings information for the
correct formatting of the various levels of headings. Remember that headings alone will not
accomplish what your writing should accomplish. In other words, your heading may announce
“Conclusion,” but if a number of paragraphs introducing new ideas follow that heading, it is
rather like a false advertisement and will confuse the reader.
At Walden, your writing is expected to reflect standard edited English. In other words, it
should appear as grammatically correct, formal, written English intended for silent reading.
Scholarly readers do not usually speak in (or listen to) standard edited English; in their oral
dialect, they naturally use contractions, slang, repetition, and all kinds of interpersonal oral
signals to one another. In a rather formal writing context, however, none of those elements of
speech are particularly useful or appropriate. In particular, APA style does not allow for the use
of contractions (e.g., write it is instead of it’s) or informal slang (i.e., use office assistant instead
of office boy and students or learners instead of kids). The writing that you are submitting for a
grade is more formal than you may be accustomed to. Take the time to read your writing aloud
or consult a grammar source regarding some stylistic elements you might have forgotten over the
years; to avoid contractions, bullets, and the use of bold type; and to be sure that your sentences
are clear to your reader. Write in your authentic voice but in your most intelligent and interesting
voice as well. Imagine what questions your reader might ask you, and then provide your reader
with well-developed, detailed, specific ideas rather than vague generalizations.
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One essential way to develop your ideas is to ground them in the course materials you
have been reading or in additional evidence-based sources that you discover in the course of your
studies. When you refer to the author of a required reading or to a statement by an expert on a
video, you are offering a context for your idea that stems from the published research by experts
in your field. For example, if you are writing about how Beach (1999) approached organizational
change and you allude to his explanation of institutionalizing change in his book Leadership and
the Art of Change, you are demonstrating your scholarship, which is an expected behavior of an
exemplary Walden student. Conversely, if your thinking remains vague and general and you do
not ground your ideas in references, your ideas are likely to be underdeveloped and taken as your
opinion. Let your readers know that you have read (or viewed) and learned from the writings of
theorists and scholars by either paraphrasing their ideas or quoting their language and following
either the quote or a paraphrase with an in-text citation. For example, you can directly quote a
source using the format illustrated by the following sentence (note that you use past tense to
report research): Knowles (1998), an authority on adult learning theory, described students as
“motivated to learn to the extent that they perceive that learning will help them perform tasks or
deal with problems that they confront in their life situations” (p. 67). The reader may be so
intrigued with this allusion to Knowles’s idea that he or she may wish to follow up by consulting
the same reference. If you want to quote material that is 40 or more words in length, you would
create a block quote, such as this quotation from the sixth edition of the Publication Manual of
the American Psychological Association (2010), which states:
Readers will better understand your ideas if you aim for continuity in words, concepts,
and thematic development from the opening sentence to the conclusion. Continuity can
be achieved in several ways. For instance, punctuation marks contribute to continuity by
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showing relationships between ideas. They cue the reader to the pauses, inflections,
subordination, and pacing normally heard in speech. (p. 65)
Note that the block quotation as shown above is double-spaced. When you end your
quotation, make sure the next paragraph transitions from that information, so your reader can
follow you. You might also want to include other theorists’ ideas to substantiate the above
information. Note that if you are citing a course video, you should not directly quote from it
because a video does not have page numbers. However, you can easily paraphrase the
information and cite the publisher of the video in a parenthatical citation, like this: (Laureate
Education, Inc., 2009). Also remember to include complete reference information for the cited
source in the reference list, for your reader to further investigate if he or she chooses.
Additionally, you may choose to cite a fellow student’s discussion post or other shared
course work to substantiate your own perspective. Citing other students is a way to use all
resources available to you, and it demonstrates your willingness to give credit to your online
colleagues. For example, in a critical analysis of a source, you might remark that a fellow student
named Alex Jones identified an author’s study as “interesting but lacking in practical application
to the classroom” (Jones, 2012) to indicate how your views harmonized with those of other
classmates. Information on how to cite discussion posts and other more unique references in
APA are found at the Writing Center’s citations web page.
Now, glance back over this essay to note that it is a well-developed piece of writing and
not merely a five-paragraph, perfunctory essay. Notice the transitional expressions that allow
your mind to move smoothly from one idea to the next. Not all paragraphs are the same length,
suggesting that the author is able to develop ideas in various ways. Try to determine what single
topic unifies each paragraph. Ask yourself, “What question does this paragraph attempt to
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answer?” Sometimes it is helpful to write out one to two words that highlight the main idea
beside each paragraph. After you have done this for each paragraph, then you should review each
sentence of the paragraph to make sure it reflects this main idea. All of your sentences should not
look or sound alike, either; some are brief and direct, while others are more complex and
flowing. For tips on varying sentence structure, see this Writing Center resource. With practice
and time, you can create an assignment that not only looks professional but also conveys your
ideas powerfully.
Some program tools can assist you in creating documents with a professional appearance.
The MS Word Troubleshooting site can be a helpful resource. If you have MS Word 2007, go to
File and then Word Options down at the bottom of the box. Then click on Proofing and select the
various components from the Grammar and Style settings. Then click OK. To check your
documents go to Review and then select ABC spelling. When a green squiggle line (indicating
potential grammatical error) or a red squiggle line (indicating potential spelling error) appears,
right click on the line, and you will get a message about the possible error. If you would like a
more complete review of grammar usage, Grammarly, an automated grammar checker offered
free to Walden students, is another program to explore. To access Grammarly, simply click the
green button that appears on the Writing Center website. However, remember that these
grammar tools are not as wise as the judgment of the author who has consulted a grammar or
usage dictionary.
Finally, just before submitting your work to your instructor, ask yourself, “Have I fully
addressed the complete assignment?” Then in your concluding paragraph, end your essay, rather
like the last gesture of tying the ribbon on a present. Some writers close an essay with a concise
summary of key ideas, as in the following sentence: “In this essay, I have examined the key
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requirements for the written assignments undergraduate students write in the Walden bachelor’s
program.” Others like to offer an idea that takes the reader beyond the implications of this
particular treatment of the topic. For more information on writing an effective conclusion, make
sure to check out the Writing Center’s resource on conclusions. However you choose to close
your essay, do close the door firmly, thereby giving the reader a satisfying sense of completion.
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References
American Psychological Association. (2010). Publication manual of the American Psychological
Association (6th ed.). Washington DC: Author.
Beach, L. R. (2006). Leadership and the art of change: A practical guide to organizational
transformation. Thousand Oaks, CA: Sage Publication.
Clark, R. E. (1994). Media will never influence learning. Educational Technology Research and
Development, 42(2), 21-29. This is an article found on hard copy. For information
about how to cite an article you found online, use the next entry.
Constantine, S. (2006). Correction in the countryside: Convict labour in rural Germany 18711914. German History, 24(1), 39-61. doi:10.1191/0266355406gh362oa
According to
the Publication Manual of the American Psychological Association (6th ed.)
guidelines for citing sources, cite the DOI number whenever one is available. The
DOI stands for Digital Object Identifier, a number specific to this article that can
help others locate the source. For a useful chart that explains how to locate a DOI,
make sure to review this flowchart from the Writing Center.
Intrigue, A., & Allure, P. (2006). An article without a DOI number. Journal of Citing Correctly,
99(3), 331-355. Retrieved from http://www.journalofcitingcorrectly.com If a DOI
number is not available, replace with the url of journal’s homepage.
Jones, P., & Boozer, C. (2001). No DOI and no journal homepage? Old Journal That Does Not
Have Its Own Homepage, 4(3), 34-44. Retrieved from
Academic Search Premiere database. If a DOI number is not available and if—in a
rare instance—the journal does not have its own homepage, provide the name of the
database.
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Knowles, M. (1998). The adult learner. Woburn, MA: Butterworth-Heinemann.
Laureate Education, Inc. (Producer). (2006). Introduction to scholarly writing: Purpose,
audience, and evidence [DVD]. In Series Title. Baltimore, MD: Author. The title of the
program goes before [DVD]. The title in italics is the name of the series. There is no
period after the title of the video before [DVD].
Laureate Education, Inc. (Producer). (2010). Name of program [Video webcast]. Retrieved from
http://www.courseurl.com.
Malborne, C. (2006, June 29). Re: Environmental responsibility [Online discussion group].
Retrieved from http://laureate.ecollege.com/ec/crs/default.learn?
CourseID=2321812&Survey=1&47=2565415&ClientNodeID=404183&coursenav=0&b
hcd2=1149711503
Note: The individual entries are double-spaced, as are the spaces between
entries.
Note the list is organized alphabetically by the author’s (or director’s) last
name, or if no author, by the first major word in a title.
The many variations for the form of a reference can be found in the Writing
Center. In general, the author’s name is listed first, followed by the year of
publication in parenthesis, the italicized title of the work with the first major
word capitalized, and the publisher.
For reference list examples and information, see the Walden University Writing Center’s APA
reference list web site.
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