Tom decides to begin investing some portion of his annual bonus, beginning this year with $6,000. In the first year he earns an 8 percent return and adds $3,000 to his investment. In the second his portfolio loses 4 percent but, sticking to his plan, he adds $1,000 to his portfolio. In this year his portfolio returns 2 percent. What is Tom's dollar-weighted average return on his investments?
A).34%
B)1.20%
C)1.54%
D)2.23%
E)2.58%

Question

Quizplus · Accepted Answer

The Answer of Tom decides to begin investing some portion of his annual bonus, beginning this year with $6,000. In the first year he earns an 8 percent return and adds $3,000 to his investment. In the second his portfolio loses 4 percent but, sticking to his plan, he adds $1,000 to his portfolio. In this year his portfolio returns 2 percent. What is Tom's dollar-weighted average return on his investments?
A).34%
B)1.20%
C)1.54%
D)2.23%
E)2.58%

Tom Decides to Begin Investing Some Portion of His Annual