What is real compounded interest rate earned

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20 years ago John invested $10,000 in a mutual fund. The value of his investment declined by 19% during the first year and then declined another 30% during the second year. 18 more years have passed, and john's cumulative return on the 20 year period is 505%

a) The value of the original investment is $______

b) If inflation has averaged 5%per year over the past 20 years, what is the spending power equivalent of the answer to part (a) in terms of real dollars 20 years ago. $______

c) What is the real compounded interest rate earned over the 20 year period? $_____

d) During the past 18 years, what compound annual rate of return (yield) was earned on John's investment? _____%

Reference no: EM13774372

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