Investment Returns and Calculations

This video tutorial explains how to calculate the total return on an investment, which is the relative change in investment value. It provides two examples: Joy's investment, which results in a loss, and Carlita's investment, which results in a profit. The video demonstrates the calculation process, including rounding and converting to percentages, and concludes with a summary of the key points.

What is the total return on an investment?

• The absolute change in investment value

• The ending value of the investment

• The relative change in investment value

• The initial value of the investment

How do you calculate the total return on an investment?

• Multiply the initial value by the ending value

• Divide the difference of ending and initial values by the initial value

• Subtract the initial value from the ending value

• Divide the initial value by the ending value

What was the initial value of Joy's investment?

• $4,000

• $16,500

• $12,500

• $8,000

What was the ending value of Joy's investment?

• $8,000

• $4,000

• $12,500

• $16,500

What is the total return percentage for Joy's investment?

• -0.242%

• -24.2%

• 24.2%

• 0.242%

Why is Joy's total return negative?

• She sold her shares for more than she bought them

• She did not sell her shares

• She sold her shares for less than she bought them

• She held the shares for too long

What was the initial value of Carlita's investment?

• $10,000

• $15,000

• $11,500

• $21,500

What was the ending value of Carlita's investment?

• $15,000

• $10,000

• $11,500

• $21,500

What is the total return percentage for Carlita's investment?

• 87.0%

• 67.0%

• 97.0%

• 78.0%

Why is Carlita's total return positive?

• She sold her shares for less than she bought them

• She did not sell her shares

• She held the shares for too long

• She sold her shares for more than she bought them