The Investment Research Institute reported in its Mutual Fund Fact Book that the number of mutual funds increased from 5725 in 1999 to 7977 in 2009. What is the geometric mean annual percent increase in the number of funds?
A) 1.034
B) 3.37
C) 39.34
D) 71.77
E) 633.5

Question

Quizplus · Accepted Answer

The geometric mean annual percent increase is calculated using the formula: [(Final Value/Initial Value)^(1/Number of Years)] - 1. Here, it is [(7977/5725)^(1/10)] - 1, which equals approximately 0.0337 or 3.37%.

The Investment Research Institute Reported in Its Mutual Fund Fact