Answer (B) is correct . Rate of return is equal to the return on an investment (the amount received minus the amount invested) divided by the amount invested. The calculation for ? these five investments can be performed as follows: Cost of Amount Rate of Investment Investment Received Return Return A $??8,500 $??8,390 $(110) (1.3%) B 4,200 4,610 410 9.8% C 12,100 12,400 300 2.5% D 7,900 8,220 320 4.1% E 11,000 11,400 400 3.6%
Answer (A) is incorrect because This ranking is in order by amount received, not rate of return.
Answer (C) is incorrect because This ranking is in order by return, not rate of return.
Answer (D) is incorrect because This ranking is from lowest rate of return to highest.
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Rank the investments in order from highest rate of return to lowest.
