Financial returns (1)
Time for some application! Earlier, Lore taught you about financial returns. Now, its time for you to put that knowledge to work! But first, a quick review.
Assume you have $100. During January, you make a 5% return on that money. How much do you have at the end of January? Well, you have 100% of your starting money, plus another 5%: 100% + 5% = 105%. In decimals, this is 1 + .05 = 1.05. This 1.05 is the return multiplier for January, and you multiply your original $100 by it to get the amount you have at the end of January.
105 = 100 * 1.05
Or in terms of variables:
post_jan_cash <- starting_cash * jan_mult
A quick way to get the multiplier is:
multiplier = 1 + (return / 100)
Este exercício faz parte do curso
Introduction to R for Finance
Instruções do exercício
- Your new starting cash, January's return, and January's return multiplier have been defined for you.
- Use them to calculate
post_jan_cash. - Print
post_jan_cash. - What if the return for January was 10%? Calculate the new
jan_mult_10. - Calculate
post_jan_cash_10using the new multiplier! - Print
post_jan_cash_10to see the impact of different interest rates!
Exercício interativo prático
Experimente este exercício completando este código de exemplo.
# Variables for starting_cash and 5% return during January
starting_cash <- 200
jan_ret <- 5
jan_mult <- 1 + (jan_ret / 100)
# How much money do you have at the end of January?
post_jan_cash <-
# Print post_jan_cash
# January 10% return multiplier
jan_ret_10 <- 10
jan_mult_10 <-
# How much money do you have at the end of January now?
post_jan_cash_10 <-
# Print post_jan_cash_10