document.write( "Question 389102: Can someone help me with this problem please. I do not understand how to work this out. Please show me step by step.\r
\n" ); document.write( "\n" ); document.write( "Top bond fund. An investment of $10,000 in the Emerging Country Debt Fund in 2001 was worth $24,780 in 2006 (www.money.com). Use the formula from the previous exercise to find the 5-year average annual return.
\n" ); document.write( " The formula is r=(s/p)^1/n -1
\n" ); document.write( "the -1 is after the rt 1/n to the right but on the same level as the (s/p) I hope that makes sense.\r
\n" ); document.write( "\n" ); document.write( " r=investment on annual return
\n" ); document.write( " S=value after n years
\n" ); document.write( "P=initial investment
\n" ); document.write( "n=number of years \r
\n" ); document.write( "\n" ); document.write( "Thank you very much! \n" ); document.write( "

Algebra.Com's Answer #275621 by stanbon(75887) $\"\"$ $\"About$

You can put this solution on YOUR website!
Top bond fund. An investment of $10,000 in the Emerging Country Debt Fund in 2001 was worth $24,780 in 2006 (www.money.com). Use the formula from the previous exercise to find the 5-year average annual return.
\n" ); document.write( "The formula is r=(s/p)^1/n -1
\n" ); document.write( "---------------
\n" ); document.write( "S = P(1+(r/n))^(nt)
\n" ); document.write( "---
\n" ); document.write( "1+(r/n) = [s/p]^(1/nt)
\n" ); document.write( "----
\n" ); document.write( "r = n[(s/p)^(1/nt)-1]
\n" ); document.write( "---
\n" ); document.write( "r = 1[(24,780/10,000)^(1/(1*5)-1]
\n" ); document.write( "---
\n" ); document.write( "r = 2.478^(1/5)
\n" ); document.write( "---
\n" ); document.write( "r = 1.199..
\n" ); document.write( "Rounding you would get rate = 20%
\n" ); document.write( "=================================
\n" ); document.write( "Cheers,
\n" ); document.write( "Stan H.
\n" ); document.write( " \n" ); document.write( "

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