9 years ago your grandfather put S55,000 in an account that paid 4.8% compounded monthly. 7...

 

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9 years ago your grandfather put S55,000 in an account that paid 4.8% compounded monthly. 7 years later he moved all the money into mutual funds. Over the next 2 years the mutual funds dropped in value by 10% from the value at the end of year 10. What effective rate of return did he average over the 12 years? i = interest, FV = future value, PV = pres. value Formulas: FV = PV (1+i)^n PV = FV/(1+i)^n or PV = FV (1+i)^-n 9 years ago your grandfather put S55,000 in an account that paid 4.8% compounded monthly. 7 years later he moved all the money into mutual funds. Over the next 2 years the mutual funds dropped in value by 10% from the value at the end of year 10. What effective rate of return did he average over the 12 years? i = interest, FV = future value, PV = pres. value Formulas: FV = PV (1+i)^n PV = FV/(1+i)^n or PV = FV (1+i)^-n

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Principal amount given in the question is 55000 Given Rate of interest per annum is 48 compounded mo... View the full answer