Question
Consider an investment with the following returns over 4 years: Year 1 2 3 4 Return 7% 16% 2% 15% a. What is the compound
Consider an investment with the following returns over 4 years:
| Year | 1 | 2 | 3 | 4 |
| Return | 7% | 16% | 2% | 15% |
a. What is the compound annual growth rate (CAGR) for this investment over the 4 years?
b. What is the average annual return of the investment over the 4 years?
c. Which is a better measure of the investment's past performance? If the investment's returns are independent and identically distributed, which is a better measure of the investment's expected return next year?
a. What is the compound annual growth rate (CAGR) for this investment over the 4 years?
The compound annual growth rate is %. (Round to two decimal places.)
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Intermediate Financial Management
Authors: Eugene F. Brigham, Louis C. Gapenski
4th Edition
0030754828, 978-0030754821
