Question

In 2009, an investor lost 25% of her investment.

In 2010, she made a profit of 30%. What is her
percent increase or decrease on her initial
investment over the last two years?

Answer 1

2.5% DECREASE

Explanation:

Let's assume the initial investment was $100 for simplicity.

In 2009, the investor lost 25%, so the value at the end of 2009 is 100−(0.25×100)=75.

In 2010, she made a profit of 30%, so the value at the end of 2010 is 75+(0.30×75)=97.5.

Now, let's calculate the overall percent increase or decrease:

Percent Change=(Final Value−Initial Value/Initial Value)×100

Percent Change=(97.5−100/100)×100

Percent Change=(−0.025)×100

Percent Change=−2.5%

Therefore, the investor experienced a 2.5% decrease in her initial investment over the last two years.