Question

You invest $50000 in Germany when the exchange rate is $1.35. Your investment gains 13% and you subsequently exchange the euros back into dollas at a rate od 1.4. What is your total percentage return on your investment

Answer 1

Answer: 17.19%

Step-by-step explanation:

Your Investment in Euros;

= 50,000 / 1.35

= €37,037.04

Investment gained 13%;

= 37,037.04 * ( 1 + 13%)

= €41,851.86

Change it back to dollars at rate of $1.4;

= 41,851.86 * 1.4

= $58,592.60

Percentage return = ( 58,592.60 - 50,000) / 50,000

= 17.19%