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Andrew [12]
3 years ago
8

Suppose an investment offers to triple your money in 24 months (don't believe it). What rate of return per quarter are you being

offered
Business
1 answer:
Natasha2012 [34]3 years ago
8 0

Answer:

30.77%

Explanation:

Assume investment = $1

Assume mount after 24 months = $5

Number of quarters in 24 months = 24/4 = 6

Future value = P*(1+r)^n; Where P is payment, r is interest rate per period, n is number of periods

5000 = 1*(1+i)^6

1*(1+i) = 5^(1/6)

1+i = 1.30766048601

i = 1.30766048601 - 1

i = 0.30766048601

i = 30.77%

So, the rate of return per quarter being offered is 30.77%

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