Year Return 1980 32.42 1981 -4.91 1982 21.55 1983 22.56 1984 6.27 1985 31.73 1986 18.67...

Year	Return
1980	32.42
1981	-4.91
1982	21.55
1983	22.56
1984	6.27
1985	31.73
1986	18.67
1987	5.25
1988	16.61
1989	31.69
1990	-3.1
1991	30.47
1992	7.62
1993	10.08
1994	1.32
1995	37.58
1996	22.96
1997	33.36
1998	28.58
1999	21.04
2000	-9.1
2001	-11.89
2002	-22.1
2003	28.68
2004	10.88
2005	4.91
2006	15.79
2007	5.49
2008	-37
2009	26.46
2010	15.06
2011	2.11
2012	16
2013	32.39
2014	13.69
2015	1.38
2016	11.96
2017	21.83
2018	-4.38
2019	31.49

How much money would you have by the end of 2019? Problem 4. Hard problem: Suppose that you invested $x in 1980. Plot the amount of money you would have in 2019 for all values of $x between $0 and $100,000. Solve using R Studio

Expert Solution

Let us consider the Investment amount in the beginning of 1980 be $100,000. For other amounts just start with that amount and follow the formula. It can be easily done is Excel.

$ 100,000 will become $8,698,412.757 at the end of 2019. The calculations and formulas for calculation are done below

I have colour segregated different columns for easy understanding.

Values are rounded upto 3 to 4 decimal points.

Year	Return %	Compounding Rate= ( 1 + Return)	Value of investment at the beginning of the year	Value of investment at the End of the year = Value of Investment at the beginning of the year × Compounding Rate for the year
1980	32.42	1.3242	100000	132420
1981	-4.91	0.9509	132420	125918.178
1982	21.55	1.2155	125918.178	153053.5454
1983	22.56	1.2256	153053.5454	187582.4252
1984	6.27	1.0627	187582.4252	199343.8433
1985	31.73	1.3173	199343.8433	262595.6447
1986	18.67	1.1867	262595.6447	311622.2516
1987	5.25	1.0525	311622.2516	327982.4198
1988	16.61	1.1661	327982.4198	382460.2997
1989	31.69	1.3169	382460.2997	503661.9687
1990	-3.1	0.969	503661.9687	488048.4477
1991	30.47	1.3047	488048.4477	636756.8097
1992	7.62	1.0762	636756.8097	685277.6786
1993	10.08	1.1008	685277.6786	754353.6686
1994	1.32	1.0132	754353.6686	764311.137
1995	37.58	1.3758	764311.137	1051539.262
1996	22.96	1.2296	1051539.262	1292972.677
1997	33.36	1.3336	1292972.677	1724308.362
1998	28.58	1.2858	1724308.362	2217115.692
1999	21.04	1.2104	2217115.692	2683596.833
2000	-9.1	0.909	2683596.833	2439389.521
2001	-11.89	0.8811	2439389.521	2149346.107
2002	-22.1	0.779	2149346.107	1674340.618
2003	28.68	1.2868	1674340.618	2154541.507
2004	10.88	1.1088	2154541.507	2388955.623
2005	4.91	1.0491	2388955.623	2506253.344
2006	15.79	1.1579	2506253.344	2901990.747
2007	5.49	1.0549	2901990.747	3061310.039
2008	-37	0.63	3061310.039	1928625.324
2009	26.46	1.2646	1928625.324	2438939.585
2010	15.06	1.1506	2438939.585	2806243.887
2011	2.11	1.0211	2806243.887	2865455.633
2012	16	1.16	2865455.633	3323928.534
2013	32.39	1.3239	3323928.534	4400548.986
2014	13.69	1.1369	4400548.986	5002984.142
2015	1.38	1.0138	5002984.142	5072025.324
2016	11.96	1.1196	5072025.324	5678639.552
2017	21.83	1.2183	5678639.552	6918286.567
2018	-4.38	0.9562	6918286.567	6615265.615
2019	31.49	1.3149	6615265.615	8698412.757

ekkarill92 answered 1 month ago

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