You have the following rates of return for a risky portfolio for several recent years:
2008 - 35.23%
2009 - 18.67%
2010 - -9.87%
2011 - 23.45%
A. $2,176.60
B. $1,785.56
C. $1,645.53
D. $1,247.87
Answer: B. $1,785.56
$1,000(1.3523)(1.1867)(1 + -.0987)(1.2345) = $1,785.56
2008 - 35.23%
2009 - 18.67%
2010 - -9.87%
2011 - 23.45%
If you invested $1,000 at the beginning of 2008, your investment at the end of 2011 would be worth ___________.
A. $2,176.60
B. $1,785.56
C. $1,645.53
D. $1,247.87
Answer: B. $1,785.56
$1,000(1.3523)(1.1867)(1 + -.0987)(1.2345) = $1,785.56