Question

You father bought a painting 10 years ago as an investment. He originally paid $8,500 for it and sold it for $48,405 this year. What was his annual return on investment?

Answer 1

Original amount paid	$        8,500.00
Sale amount	$      48,405.00
Period in years	10
Amount=	Original amount * (1+return)^time
48405=	8500*(1+return)^10
48405/8500=	(1+return)^10
5.694705882	(1+return)^10
(1+return)=	(5.69470588235294)^(1/10)
(1+return)=	1.190000462
Return=	19.00%