Refer to Exercise 3 52 The values of the DJIA on the first day of trading in 2005, 2006, 2007, 2008, and 2009 were 10,729 43, 10,847 41, 12,474 52, 13,043 96, and 9,034 69 a Calculate the geometric mean rate of return for the DJIA from 2005 to 2013 b If an investment of $100,000 is made in 2005 and...

Refer to Exercise 3.52. The values of the DJIA on the first day of trading in 2005,

Question:

Refer to Exercise 3.52. The values of the DJIA on the first day of trading in 2005, 2006, 2007, 2008, and 2009 were 10,729.43, 10,847.41, 12,474.52, 13,043.96, and 9,034.69.

Year DJIA NASDAQ 2308.42 2691.52 2648.72 S&P 500 2010 2011 2012 10,583.96 11,670.75 12,397.38 13,412.55 1132.99 1271.87

a. Calculate the geometric mean rate of return for the DJIA from 2005 to 2013.
b. If an investment of $100,000 is made in 2005 and the portfolio performs with returns equal to those of the DJIA, what is the investment worth in 2013?

Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...

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