what was the average growth on his total investment?

Question

Patrick invested 30% of his money in mutual funds, 20% in real estate, and the balance in stocks. If the value of the money that he invested in mutual funds, real estate, and stocks grew by 4%, 6%, and 11% respectively, what was the average growth on his total investment?

Answer 1

Let's say his money is X

 

30% X is mutual funds, 20% X real state and the rest is 50% X in stocks.

 

On the other hand

 

The average is the sum of the three investments. However, MF earned 4%, RS 6% and ST 11%

 

That means:

 

MF earned: 0.3X * 4/100 = 0.012X

 

RS earned: 0.2X * 6/100 = 0.012X

 

MF earned: 0.5X * 11/100 = 0.055X

 

The average is (0.012X + 0.012X + 0.055X)= 0.079  =>  7.9%