Questions from Business Mathematics

Q: An investment grew in value from $5630 to $8485 during

An investment grew in value from $5630 to $8485 during a five-year period. The annual rate of inflation for the five years was 2.3%. What was the compound annual real rate of return during the five ye...

Q: An investment earned 6% compounded semiannually for two years and 8

An investment earned 6% compounded semiannually for two years and 8% compounded annually for the next three years. What was the equivalent annually compounded rate of return for the entire five-year p...

Q: A portfolio earned annual rates of 20%, −20%, 0

A portfolio earned annual rates of 20%, −20%, 0%, 20%, and −20% in five successive years. What was the portfolio’s five-year equivalent annually compounded rate of return?

Q: A portfolio earned annual rates of 20%, 15%, −10

A portfolio earned annual rates of 20%, 15%, −10%, 25%, and −5% in five successive years. What was the portfolio’s five-year equivalent annually compounded rate of return?

Q: At the end of 2018, the RBC Canadian Dividend Fund was

At the end of 2018, the RBC Canadian Dividend Fund was the largest equity mutual fund in Canada. The aggregate market value of its holdings at the end of 2018 was $18.8 billion. The fund’s annual retu...

Q: At the end of 2014, the Industrial Alliance (IA)

At the end of 2014, the Industrial Alliance (IA) Dividends Fund had the best 10-year compound annual return of any Canadian diversified equity mutual fund. During the 10-year period, this fund investe...

Q: The “age” of an account receivable is the length of

The “age” of an account receivable is the length of time that it has been outstanding. At the end of October, a firm has $12,570 in receivables that are 30 days old, $6850 in receivables that are 60 d...

Q: BMO’s Dividend Fund was launched in 1994 and had annual returns in

BMO’s Dividend Fund was launched in 1994 and had annual returns in successive years from 2009 to 2018 inclusive of 19.83%, 9.71%, −2.62%, 6.93%, 17.92%, 13.54%, –1.43%, 11.76%, 10.93% and –6.78%, resp...

Q: In June of 2006, AIC Limited published full-page advertisements

In June of 2006, AIC Limited published full-page advertisements focused on the fact that its AIC Advantage Mutual Fund was Canada’s “Best Performing Canadian Equity Fund” over the 20 years ending May...

Q: A strip bond that will mature 7 1 2 years from now

A strip bond that will mature 7 1 2 years from now at its $13,000 face value can be purchased today for $9042. What rate of return (compounded semiannually) will this strip bond provide to an investor...