Suppose that you are told that an investment of $1,000 earned a 100 percent return one year and that the proceeds (i.e., principal and interest) were reinvested in the same asset the next year, earning a 50 percent return and resulting in a cash value at the end of the two years of $3,000.

A. Calculate the arithmetic average

B. Calculate the geometric average

C. Show me how we arrive at the cash value of $3,000