Answered: Isabella purchased $20,000 worth of…

Isabella purchased $20,000 worth of 26-week T-Bills for $19,700. What will be the rate of return on her investment? (Round your answer to two decimal places.)

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 10E

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Question

Isabella purchased $20,000 worth of 26-week T-Bills for $19,700. What will be the rate of return on her investment? (Round your answer to two decimal places.)

Definition Definition Percentage gain or loss from a specific investment over time. The rate of return is the difference between the closing and initial values of an investment divided by the initial value of the investment. The closing value includes any intermediate cash flows such as dividends or interest amounts.

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