Finance

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A financial analyst tells you that investing in stocks will allow you to triple your money in 15 years. What annual rate of return is the analyst assuming you can earn?

  • Finance -

    (1+i)^15 = 3
    log both sides
    log((1+i)^15) = log3
    15 log (1+i) = log3

    log 1+i = log3/15
    1+i = 1.07598

    i = .07598
    You would have to earn about 7.6 % a year to triple your money in 15 years

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