Question

You have a portfolio valued at $10,000. Over the next twelve months it loses 50% of its value. What return does the portfolio need to earn over the following twelve months to be restored to its original value?

Answer 1

return = 100%

Step-by-step explanation:

given data

portfolio valued = $10,000

time = 12 months

loses = 50%

solution

we get here loss value for next 12 month is

= $10,000 × 50% .....................1

= $10,000 × 0.50

= $5000

and

return will be here as

return =
`(5000)/(5000)` × 100 .......................2

return = 1 × 100

return = 100%