Suppose you made a 5% down payment on a house on January 1,2013,and on January 1,2014 you decided to sell the house.If the price of your house decreased by 10%,the return on your investment in the house would be

Question

Quizplus · Accepted Answer

The return on investment is calculated based on the initial investment. With a 5% down payment, if the house price decreases by 10%, the loss is double the initial investment, resulting in a -200% return.

Suppose You Made a 5% Down Payment on a House