- In 2008, the last baseball hit for a home run by Barry. Bonds was auctioned off for about 376,000 The price of the ball was considered a bargain, in part because potential buyer were unsure if Bonds would play again. Experts on such collectibles often argue that collectibles such as this will double in value over a 10-year period. Question: What is the return on investment each year over the 10-year period?

Question

- In 2008, the last baseball hit for a home run by Barry. Bonds was auctioned off for about 376,000 The price of the ball was considered a bargain, in part because potential buyer were unsure if Bonds would play again. Experts on such collectibles often argue that collectibles such as this will double in value over a 10-year period. Question: What is the return on investment each year over the 10-year period?

Answer 1

To calculate the return on investment (ROI) each year over the 10-year period, we need to first determine the future value of the baseball after 10 years, assuming it doubles in value.Let's denote the initial price of the baseball as

and the final price after 10 years as

.Given:- Initial price,

:

Where:-

is the future value-

is the present value (initial price)-

is the annual return rate-

is the number of yearsPlugging in the values:

376,000:

Take the 10th root of both sides to solve for

:

So,

Convert the decimal to a percentage:

Therefore, the annual return on investment over the 10-year period is approximately 7.18%.

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