Question

Assume you invest $100 in an investment that gained a 100% return in year 1 and lost 50% in year 2. how much would you have left at the end of year 2?

Answer 1

Hello! So, you invest $100 in an investment and you gain 100% of that in year 1. Gaining 100% of something is earning double the amount. 100 * 2 is 200. Then, you lose 50% of that amount in 1 year, which is losing ½ of that amount. You can multiply by 50% (0.5) or divide by 2 to get you to the answer. But when you do either of them, you get 100. You would have $100 left at the end of year 2.