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Calculate the expected returns from year one to year three

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Reference no: EM133114804

Question - A 3-year investment has a quoted interest rate of 15%. You wish to invest AUD 75,000.

a. Calculate the expected returns from year 1 to year 3 if the investment earns simple interest.

b. Calculate the expected returns from year 1 to year 3 if the investment earns compound interest

c. Is there a difference in the returns you have calculated? Explain why.

Reference no: EM133114804

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