For the Two Questions Below, Consider the Following Period-By-Period Total

question 25

Multiple Choice

For the two questions below, consider the following period-by-period total returns:
Year 1: 5.00%
Year 2: 15.00%
Year 3: 25.00%
-What is the arithmetic average total return per year for the Years 1-3 period?

• A) 5.00%
• B) 14.71%
• C) 15.00%
• D) 15.23%
• E) 45.00%

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Definitions:

Capital Account Balances

The amounts recorded in a company's financial statements under the heading of Capital, representing the cumulative sum of initial and additional investments minus withdrawals by owners.

Noncash Assets

Assets that are not in the form of cash or cash equivalents, such as equipment, real estate, or intellectual property.

Liquidation Expenses

Costs associated with closing down a business or selling off its assets.

Account Balances

The amounts of money in a financial account at a specific point in time, reflecting all completed transactions.