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  • #16007

    Are you better off if a project first returns –10% followed by +30%, or if it first returns +30% followed by –10%?

    #16008

    Solution
    Case 1

    (1+ (-).10) * (1+.30) ^2 = .90*1.96 = 1.521 = 15.21%

    Case 2

    (1+.30) * (1+(-).10) ^2 = 1.30*.81= 1.053 = 10.53%
    Case 1 is better off.

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