John Began His Investing Program with a $5,500 Initial Investment

question 92

Multiple Choice

John began his investing program with a $5,500 initial investment. The table below recaps his returns each year as well as the amounts he added to his investment account. What is his dollar-weighted average return?
$\begin{array}{ccr}\text { Time } & \text { Investment } & \text { Return } \\0 & \$ 5,500 & 8.5\% \\1 & \$ 2,000 & -5.0\% \\2 & \$ 2,600 & 4.5\% \\3 & \$ 3,000 & 9.0\% \\4 & \$ 900 & -2.5\%\end{array}$

• A)1.5%
• B)1.8%
• C)2.0%
• D)2.2%
• E)2.6%

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Definitions:

Market

An area or arena in which commercial dealings are conducted, including the buying and selling of goods and services.

Segmented Components

Parts or sections of a product designed to be easily separable, often for customization, maintenance, or recycling purposes.

Services

Economic activities that typically produce an intangible product (such as education, entertainment, lodging, government, financial, and health services).

Decision Trees

A graphical representation used for making decisions, showing various outcomes based on different sequences of decision paths.