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Lance Murdock purchased a wooden statue of a Conquistador for $7,800 to put in his home office 8 years ago. Lance has recently married, and his home office is being converted into a sewing room. His new wife, who has far better taste than Lance, thinks the Conquistador is hideous and must go immediately. Lance decided to sell it on e-Bay and only received $4,500 for it, and so he took a loss on the investment.
Problem 1: What was his rate of return, that is, the value of i? What was Lance Murdock's rate of return, that is, the value of i?
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