You invest $2,000.00 in a stock plan and another $2,000.00 in a savings account. The stock plan decreases by 7% the first year and gains 10% the second year. The savings account earns a 3.7%APR and compounds annually. What is the difference in earnings between the stock and savings account at the end of the second year?

Question

yolomcswagginsggg · Answer

If the stock increases by 10% means the present value of your investment in stock is $2200 ( 2000 + 200) Where as your balance in the Savings Bank account after one year will be $2074 ( 2000 +74) 
So your gain is around $126/ Anyhow, there is risk in the investment of stock.

anonymous · Answer

You copied that off yahoo, it doesn't help me at all. Thanks though.