If a $15,000 Investment Grew to $21,805 in 4½ Years

question 27

Short Answer

If a $15,000 investment grew to $21,805 in 4½ years of quarterly compounding, what effective rate of return was the investment earning?

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Definitions:

Accounts Receivable

Financial obligations customers have towards a business for availed goods or services which are unpaid.

Customers

Individuals or entities that purchase goods or services offered by a business.

Horizontal Analysis

Horizontal analysis is a financial analysis technique that compares historical financial data over a series of reporting periods, using the increase or decrease in absolute amounts and percentages to identify trends.

Income Statement

A financial statement that reports a company’s financial performance over a specific accounting period, detailing revenues, expenses, and profits or losses.