Question 14
Net return after fees can change long-term outcomes. Suppose a fund returns 8.00% before fees and charges a 0.75% expense ratio; the investor's net annual return is therefore 7.25%. Over multi-decade horizons, small net-return differences compound into meaningful dollar amounts. This calculation asks you to apply the net return to a $5,000 initial investment held 20 years. Use annual compounding and round to the nearest cent.
If $5,000 is invested at a net annual return of 7.25% for 20 years, what is its approximate value (rounded to nearest cent)?
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