Question

If Penny bought a stock for $80 dollars and could sell it 15 years later for 4 times what she originally paid, what is Penny’s return on owning this stock? (Enter your answer as a whole percentage (e.g. .35 should be entered as 35).)

Answer 1

Answer:

10%

Explanation:

Data provided in the question

Purchase value of the stock = $80

Number of years = 15

Times = 4

So, the return on owning this stock is

= Number of times^(1 ÷ number of years) - 1

= 4^(1÷15) - 1

= 4^0.0666666667  - 1

= 1.0968249797  - 1

= 0.0968249797

= 10% round off

All other things that are mentioned in the question is not relevant. Hence, ignored it