Suppose that at the beginning of Year 1 you invested 10,000 in the Stivers mutual fund...

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Suppose that at the beginning of Year 1 you invested 10,000 in the Stivers mutual fund...

Suppose that at the beginning of Year 1 you invested 10,000 in the Stivers mutual fund and 5,000 in the Trippi mutual fund. The value of each investment at the end of each subsequent year is provided in the table below. Year

Stivers Trippi

Year 1 $10,900 $5,600

Year 2 $11,700 $6,300

Year 3 $12,900 $6,900

Year 4 $13,900 $7,600

Year 5 $15,000 $8,600

Year 6 $16,100 $9,300

Year 7 $17,100 $9,900

Year 8 $18,000 $10,700 Compute the mean annual return for the Stivers mutual fund and for the Trippi mutual fund. Do not round intermediate calculations.

Stivers 7.624

Trippi --- this is the one I am having issues with.

Mean annual return (to decimals)

Stivers

business accounting

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Answer 1

Answer #1

Year	Stivers	Return (Pn-Pn-1/Pn-1)	Trippi	Return (Pn-Pn-1/Pn-1)
0	10000		5000
1	10900	9.0000%	5600	12.0000%
2	11700	7.3394%	6300	12.5000%
3	12900	10.2564%	6900	9.5238%
4	13900	7.7519%	7600	10.1449%
5	15000	7.9137%	8600	13.1579%
6	16100	7.3333%	9300	8.1395%
7	17100	6.2112%	9900	6.4516%
8	18000	5.2632%	10700	8.0808%
Total Return		61.0691%		79.9986%
Mean Annual Return=Total Return/8 years
=61.0691%/8		7.6336%	=79.9986%/8	9.9998%

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Answer 2

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Suppose that at the beginning of Year 1 you invested 10,000 in the Stivers mutual fund...

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