Question

If the value of Jane's retirement portfolio increased from 170,000 to813,000 over a 15-year period, with no deposits made to the account over that period, what annual rate of return did she make?

Answer 1

Jane made an annual rate of return of approximately 9.91% on her retirement portfolio.

Step-by-step explanation:

Jane made an annual rate of return of approximately 9.91% on her retirement portfolio.

To calculate the annual rate of return, we can use the formula:

R = (Pf / Pi)^(1 / n) - 1

Where:

R = Annual rate of return, Pf = Final value of the portfolio, Pi = Initial value of the portfolio, n = Number of years

Plugging in the given values:

R = (813,000 / 170,000)^(1 / 15) - 1 = 0.09905536

So, the annual rate of return Jane made is approximately 9.91%.