Calculate the effective annual return of each investment

Reference no: EM13263069

WG Investors is looking at three different investment opportunities. Investment one is a five-year investment with a cost of $230 and a promised payout of $460 at maturity. Investment two is a seven-year investment with a cost of $230 and a promised payout of $644. Investment three is a ten-year investment with a cost of $230 and a promised payout of $1,058. WG Investors can take on only one of the three investments. Assuming that all three investment opportunities have the same level of risk, calculate the effective annual return of each investment and select the best investment choice.

Reference no: EM13263069

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