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You invest $135 in a mutual fund that grows 12 percent annually for three years. Then...

You invest $135 in a mutual fund that grows 12 percent annually for three years. Then the fund experiences an exceptionally bad year and declines by 25 percent. After the bad year, the fund resumes its 12 percent annual return for the next three years.

a. What is the average percentage change for the seven years?

b. If you liquidate the fund after nine years, how much do you receive?

c. What is the annualized return on this investment using a dollar-weighted calculation and using a time-weighted calculation?

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Answer #1

in the given solution liquidate the fund caluculated after seven years but asked in the question is after nine years , that is not possible there may be chnage in question

Please give positive vote , let me know if you need any further information regarding the question

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Answer #2

answered by: asen
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