Tahmid H.

asked • 11d

Averaging percentages

How do you find the average for 3 percentages?

2 Answers By Expert Tutors

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Betty O. answered • 11d

Excellent Finance tutor with 2 years of tutoring experience

Lenny D.

tutor
If you had an investment which grew at 5% then 9% Then 2% you would have (1+5%)(1+9%)(1+2%) = 1.16739 after 3 years. The order does not matter. Your Investment Grows (on average) (1.16739)^(1/3)-1 or 5.294%. The wider the dispersion of these percentages the lower the geometric mean will be
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