Investments in the stock market have increased at an average compound rate of ab

Question

Investments in the stock market have increased at an average compound rate of about 5% since 1901. It is now 2012.

If you invested $1,000 in the stock market in 1901, how much would that investment be worth today? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

If your investment in 1901 has grown to $1 million, how much did you invest in 1901? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

If you invested $1,000 in the stock market in 1901, how much would that investment be worth today? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Explanation / Answer

1000*1.05^20 =2653.297705

1000000/1.05^20 =376889.4829

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