Computing rate of return on total portfolio

Reference no: EM131773659

Question: Jack invests $2,000 in Bond A and $2,000 in Bond B. On the same day Tom invests $2,000 in Bond C and $8,000 in Bond D. At the end of six months Bond A is worth $2,050, Bond B is worth $2,100, Bond C is worth $2,040, and Bond D is worth $8,360. Confirm that Jack has a higher (internal) rate of return on each of his bonds than Tom, but Tom has a higher (internal) rate of return on his total portfolio.

Reference no: EM131773659

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