Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

2) On January 1, 2018, Yves invests $50,000 to a mutual fund investing in a mix on stocks and bonds. Balances and cashflow amounts from

image text in transcribed
2) On January 1, 2018, Yves invests $50,000 to a mutual fund investing in a mix on stocks and bonds. Balances and cashflow amounts from 2018-2020 are shown below. Note that he makes no further deposits in 2018 or 2019 but makes two deposits in 2020. Date Cashflow January 1, 2018 December 31, 2018 December 31, 2019 May 1, 2020 August 31, 2020 December 31, 2020 +$50,000 $0 $0 +$5,000 +$8,000 $0 Account Balance After Cashflow $50,000 $52,368 $55,059 $58,843 $68,157 $69,863 a) Find his annual effective return in 2019 b) Find his average effective annual return over 2018-9. c) Find the amount of investment income earned in 2020. d) Find his time weighted rate of return for 2020. e) Find his dollar weighted rate of return for 2020. (10 points) 2) On January 1, 2018, Yves invests $50,000 to a mutual fund investing in a mix on stocks and bonds. Balances and cashflow amounts from 2018-2020 are shown below. Note that he makes no further deposits in 2018 or 2019 but makes two deposits in 2020. Date Cashflow January 1, 2018 December 31, 2018 December 31, 2019 May 1, 2020 August 31, 2020 December 31, 2020 +$50,000 $0 $0 +$5,000 +$8,000 $0 Account Balance After Cashflow $50,000 $52,368 $55,059 $58,843 $68,157 $69,863 a) Find his annual effective return in 2019 b) Find his average effective annual return over 2018-9. c) Find the amount of investment income earned in 2020. d) Find his time weighted rate of return for 2020. e) Find his dollar weighted rate of return for 2020. (10 points)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Personal Finance

Authors: Jeff Madura

6th Edition

0134082915, 9780134082912

More Books

Students also viewed these Finance questions

Question

=+b) In which graph is a larger value of a used?

Answered: 1 week ago

Question

Describe ERP and how it can create efficiency within a business

Answered: 1 week ago

Question

5. It is the needs of the individual that are important.

Answered: 1 week ago

Question

3. It is the commitment you show that is the deciding factor.

Answered: 1 week ago