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Holding period and annual​ (investment) returns. Bohenick Classic Automobiles restores and rebuilds old classic cars. The...

Holding period and annual​ (investment) returns. Bohenick Classic Automobiles restores and rebuilds old classic cars. The company purchased and restored a classic 1957 Thunderbird convertible 5 years ago for $7,300.00. Today at auction, the car sold for $65,700.00. What are the holding period return and the annual return on this investment?

What is the holding period return of the car? Round to 2 decimal places

What is the annual return on this investment?

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Homework Answers

Answer #1
ans 1 Computation of holding period return
HPR = 800.00%
(65,700-7,300)/7300
ans = 800.00%
ans 2 Computation of annual return
we have to use financial calculator to sovle this
put in calculator
FV 65700
PV -7300
PMT 0
N 5
Compute I 55.18%
ans = 55.18%
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