You save $5,000.00 and invest 60% of it in stocks while leaving the rest in a savings account earning a 4.9% APR. The stock increases 9% in the first year and loses 4% of its value the second year. What is the total amount gained during the 2 years?
Hi there:) Amount invested in stock =5000×0.6=3000 Amount invested in a saving account 5000-3000=2000
The stock increases 9% in the first year 3,000×(1+0.09)=3,270 and loses 4% of its value the second year 3,270×(1−0.04)=3,139.2 Amount of a saving account after two years 2,000×(1+0.049)^(2)=2,200.8
the total amount gained during the 2 years 3,139.2+2,200.8=5,340...answer
