Question
An investor is evaluating the historical performance of an investment fund. The following annual returns are provided to the investor: Fund Value Year 0 $120
An investor is evaluating the historical performance of an investment fund. The following annual returns are provided to the investor:
| Fund Value | |
|---|---|
| Year 0 | $120 |
| Year 1 | 132 |
| Year 2 | 146 |
| Year 3 | 133 |
| Year 4 | 128 |
| Year 5 | 123 |
Required:
a. Calculate the investment returns for each year.
b. Compute the arithmetic mean return.
c. Calculate the geometric mean return.
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The Economics Of Money Banking And Financial Markets
Authors: Frederic S. Mishkin
12th Global Edition
1292268859, 978-1292268859
