Royale Real Estate Group bought property for $1,000,000. Royale then sold the property 40 years later for $800,000.What was Royale Real Estate Group's return on investment?

Respuesta :

The return of any investment is measured by the difference of the value it was sold with the value it was bought.

It means:

[tex]R=B-S[/tex]

Substituting the values, we have the following answer:

[tex]\begin{gathered} R=800,000-1,000,000 \\ R=\text{ \$}-200,000 \end{gathered}[/tex]

From the solution developed above, we conclude that the return is negative. It was a return of $ -200,000

The percentage can be calculated as follows:

[tex]\begin{gathered} R_p=\frac{R}{B}\times100 \\ R_p=\frac{-200,000}{1,000,000}\times100 \\ R_p=-20\text{ \%} \end{gathered}[/tex]

The return of the present investment is -20%