Answer Happy

1. Suppose the rates of (realized) return were 80% in the
1st year, -50% in the 2nd year, 20%
in the 3rd year.
(i) ) If you had invested at the beginning of
1st year $1,000, how much would you have had at the
end of the 3rd year?
What would have been the annual rate of return (i.e., the
time-weighted average rate of return) over the three-year period?
Please show your calculation.
(ii) If you had invested at the beginning of
1st year $1,000, another $1,000 at the beginning of
the second year, and another $1,000 at the beginning of the 3rd
year, how much would you have had at the end of the 3rd
year?
What would have been the annual rate of return (i.e., the
dollar-weighted average rate of return) over the three-year span?
Please show your calculation.