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The stock market provided the following return over the last 3 years. Year Return 2016 +15...

The stock market provided the following return over the last 3 years.

Year

Return

2016

+15

2017

-30

2018

+35
  1. What is the arithmetic average return?
  2. What is the geometric average return?
  3. Suppose you invested $1000 at the beginning of each of 2016,2017,2018 and withdrew all funds at the end of 2018, what is your average return (IRR)

Solutions

Expert Solution

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

Cell reference -

jeff jeffy answered 2 years ago
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