The table below shows the average return on u.s. stocks and, Ask an Expert

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The table below shows the average return on U.S. stocks and bonds for 25-year periods ending in 1925, 1950, 1975,and 2000. find out the equity risk premium fo each quarter century. What lesson emerges from your calculations?

Ave. Return 1925 1950 1975 2000

stocks 9.7% 10.2% 11.4% 16.2%

bonds 3.5% 4.1% 2.4% 10.6%

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