Research to find the average return over the last five or ten years on a mutual

Question

Research to find the average return over the last five or ten years on a mutual fund of your choice. Use that average return to see what your investment account would look like if you had invested $5,000, $10,000, $15,000 and $20,000 for 35 years compounded quarterly. Show your result numerically and graphically. What can you conclude about the effect of initial investment on retirement investment any one who answers my question correctly shall get a 5 star rating.Besides, am going to order a 10 page research paper and my budget will be $ 350.thank you

Explanation / Answer

Let the average return in 5 years for an mutual fund is 15% a year

Now taaking the average we can compund our investment schedule numnerically

At t = 0

Let us calculate the PV of all cash flows for 35 years compounded quarterly. So discount rate = 15/4 = 3.75%

The present value of all investments is $325309.95

So investment account after 35 years will be 325309.95(1+0.375)^140 = $56316039

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