Assume you purchase an asset that cost 6000 and borrow 40 % of the cost from a wealthy relative. After a year the asset is worth 7800 . What is your rate of return on your investment?

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The initial cost of the asset is $6000, and 40% of this cost, which is $2400, is borrowed. Therefore, the personal investment is $3600 ($6000 - $2400). After a year, the asset's value increases to $7800. The profit is $1800 ($7800 - $6000). The rate of return on the personal investment is calculated as (Profit / Personal Investment) * 100 = ($1800 / $3600) * 100 = 50%.

Assume You Purchase an Asset That Cost 6000 and Borrow