Tom Decides to Begin Investing Some Portion of His Annual

question 63

Multiple Choice

Tom decides to begin investing some portion of his annual bonus,beginning this year with $6,000.In the first year he earns a 8% return and adds $3,000 to his investment.In the second his portfolio loses 4% but,sticking to his plan,he adds $1,000 to his portfolio.In this year his portfolio returns 2%.What is Tom's dollar-weighted average return on his investments?

• A)0.34 percent
• B)1.20 percent
• C)1.54 percent
• D)2.23 percent
• E)2.58 percent