If an investor holds a share for three years,the value at the end of three years will always be the initial cost of the share times (1 + arithmetic average return)to the third power.

Question

Quizplus · Accepted Answer

The value at the end of three years will depend on the current market conditions and the performance of the company, the arithmetic average return does not guarantee a specific value.

If an Investor Holds a Share for Three Years,the Value