George buys an antique car for $20,000 and sells it five years later for just over $24,000.George's per-year rate of return is

Question

Quizplus · Accepted Answer

The per-year rate of return can be calculated using the formula for compound annual growth rate (CAGR): [(Final Value/Initial Value)^(1/Number of Years)] - 1. Plugging in the values: [(24000/20000)^(1/5)] - 1 = 0.03714, which is approximately 4 percent.

George Buys an Antique Car for $20,000 and Sells It