85.503075=127.015881/(1+r)to the power of 4Answer is r=0.1040How did they get to that answer from the above equation?

not a troll man i see where i went wrong, i didn't do it to the power of 0.25 but rather 4. thanks much

Honestly, I'm not sure if you're trolling at this point - your questions are a matter of working through the algebraic calculations. Anyways in the spirit of good community spirit:85.503075 = 127.015881 / [(1 + r)]^4[(1 + r)]^4 = 127.015881 / 85.503075[(1 + r)]^4 = 1.48551243332(1 + r) = (1.48551243332)^(1/4)(1 + r) = (1.48551243332)^(1/4)1 + r = 1.104r = 1.104 - 1r = 0.104

A CFA Level 1 Discussion About Realized Rate Of Return

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This topic has 2 replies, 2 voices, and was last updated Jun-198:15 am by cfastaf.

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- cfastaf
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  - CFA Level 1
  24 Jun 2019 at 11:32 am
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  85.503075=127.015881/(1+r)to the power of 4
  
  Answer is r=0.1040
  
  How did they get to that answer from the above equation?
- mincemeat23
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  - CFA Level 1
  24 Jun 2019 at 3:11 pm
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  Honestly, I’m not sure if you’re trolling at this point – your questions are a matter of working through the algebraic calculations. Anyways in the spirit of good community spirit:
  
  85.503075 = 127.015881 / [(1 + r)]^4
  
  [(1 + r)]^4 = 127.015881 / 85.503075
  
  [(1 + r)]^4 = 1.48551243332
  
  (1 + r) = (1.48551243332)^(1/4)
  
  (1 + r) = (1.48551243332)^(1/4)
  
  1 + r = 1.104
  
  r = 1.104 – 1
  
  r = 0.104
- cfastaf
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  25 Jun 2019 at 8:15 am
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  not a troll man i see where i went wrong, i didn’t do it to the power of 0.25 but rather 4. thanks much
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