Investment
= $1,000
Green
Fund:
Year 1 =
-0.095 * 1000 = - $95
Amount after
1 year = $905
Year 2 =
0.1 * 905 = $90.5
Amount after
2 year = 905 + 90.5 = $995.5
Purple
Fund:
Year 1 =
0.1 * 1000 = $100
Amount after
1 year = 1000 + 100 = $1100
Year 2 =
-0.095 * 1100 = $104.5
Amount after
2 year = 1100 – 104.5 = $995.5
Yellow fund:
Year 1 = 0.3
* 1000 = $300
Amount after
1 year = 1000 + 300 = $1300
Year 2 =
-0.25 * 1300 = $325
Amount after
2 year =1300 – 325 = $975
Orange Fund:
0% return
for both the years.
Amount after
2 year = $1000
<span>Thus Orange
Fund has the highest value at the end of the second year.</span>
