Sara Would Like to Evaluate the Performance of Her Portfolio

question 76

Multiple Choice

Sara would like to evaluate the performance of her portfolio over the past 10 years. What compound annual rate of return has she achieved if she invested $12,000 10 years ago and now has $25,000?

• A)Between 8% and 9%
• B)Between 10% and 11%
• C)Between 9% and 10%
• D)Between 7% and 8%

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Definitions:

Dollar Value

This refers to the worth or purchasing power of the U.S. dollar, often used in comparison to other currencies.

Assets

Resources owned or controlled by a person or entity that are expected to produce value or economic benefit in the future.

Balance Of Payments

A statement that summarizes a country’s transactions with the rest of the world, including trade, financial transfers, and investments.

Negative Balance

A situation in financial accounts where the amount spent exceeds the amount available or deposited.