Question

When data consist of percentages, ratios, growth rates, or other rates of change, the geometric mean is a useful measure of central tendency. for n data values the geometric mean, assuming all data values are positive, is as follows. to find the average growth factor over 5 years of an investment in a mutual fund with growth rates of 9.3% the first year, 12% the second year, 14.5% the third year, 4.6% the fourth year, and 5.7% the fifth year, take the geometric mean of 1.093, 1.12, 1.145, 1.046, and 1.057. find the average growth factor of this investment. (round your answer to four decimal places.) geometric mean = n product of the n data values?

Answer 1

$mean=\sqrt[5]{1.093\cdot1.12\cdot1.145\cdot1.046\cdot1.057}=\sqrt[5]{1.5497096705104}\\\\ \approx 1.0916$

The geometric mean is 1.0916.