The Colossal investment portfolio when all the information accountant can gather is that the company invested in 3 firms X, Y and Z. And earned $ 8 million on investing $65 million. Investment in company X earned 15% last year, investment in company Y depreciated by 20% last year, investments in Z neither appreciated nor depreciated while W earned 20% last year. Colossal invested twice as much in X as in company Z, and investment in X is mounted to $30 million. Also, find what should smiley do.

Question

Want to see the full answer?

Answer 1

Question

Chapter 4.3, Problem 48E

To determine

To calculate: The Colossal investment portfolio when all the information accountant can gather is that the company invested in 3 firms X, Y and Z. And earned $ 8 million on investing $65 million. Investment in company X earned 15% last year, investment in company Y depreciated by 20% last year, investments in Z neither appreciated nor depreciated while W earned 20% last year. Colossal invested twice as much in X as in company Z, and investment in X is mounted to $30 million. Also, find what should smiley do.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Suppose that at the beginning of Year 1 you invested 10,000 USD in the Stivers mutual fund and 5,000 USD in the Trippi mutual fund. The value of each investment at the end of each subsequent year is provided in the table below. Year Stivers Trippi Year 1 $11,000 $5,600 Year 2 $12,000 $6,300 Year 3 $12,900 $6,900 Year 4 $13,900 $7,600 Year 5 $14,900 $8,600 Year 6 $16,000 $9,300 Year 7 $17,100 $9,900 Year 8 $18,300 $10,700 a. Compute the mean annual return for the Stivers mutual fund and for the Trippi mutual fund. Do not round intermediate calculations. Mean annual return (to 3 decimals) Stivers is ____% and ____% for Trippi b. Which mutual fund performed better?

Suppose that at the beginning of Year 1 you invested $10,000 in the Stivers mutual fund and $5,000 in the Trippi mutual fund. The value of each investment at the end of each subsequent year is provided in the table below. Year Stivers Trippi Year 1 $10,500 $5,600 Year 2 $11,800 $6,400 Year 3 $13,000 $6,900 Year 4 $14,000 $7,700 Year 5 $14,900 $8,600 Year 6 $16,100 $9,200 Year 7 $17,000 $9,900 Year 8 $18,200 $10,600 Compute the mean annual return for the Stivers mutual fund and for the Trippi mutual fund. Do not round intermediate calculations. Stivers Trippi Mean annual return (to 3 decimals) % % Which mutual fund performed better?

Suppose that at the beginning of Year 1 you invested $10,000 in the Stivers mutual fund and $5,000 in the Trippi mutual fund. The value of each investment at the end of each subsequent year is provided in the table below. Year Stivers Trippi Year 1 $10,600 $5,600 Year 2 $11,700 $6,300 Year 3 $12,700 $7,000 Year 4 $14,000 $7,600 Year 5 $15,000 $8,600 Year 6 $16,100 $9,200 Year 7 $17,200 $9,900 Year 8 $18,400 $10,700 Compute the mean annual return for the Stivers mutual fund and for the Trippi mutual fund. Do not round intermediate calculations. Stivers Trippi Mean annual return (to 3 decimals)