Answered

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Calculate the geometric average return earned by an investor over three years if she earned 6% in the first year of an investment, 12% in the second year and 10% in the third year.

Sagot :

Answer:

8.96%

Explanation:

[tex]\sqrt[\frac{1}{n} ]{x1. x2.x3...}[/tex] = geometric average return

n = number of observations

x1 = observations

(0.06 x 0.12 x 0.1)^(1/3) = 0.0896 = 8.96%

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