\nSuppose an investment loses x% this year. What percent does the resulting sum need to gain next year in order to break even?\n<\/p>\n
\nImagine an investment of initial value $250. If, for instance, the investment loses 12% this year, it’s worth 250(1-12\/100)=220 at year end. The % growth needed, the following year, to return to $250 is (250\/220 – 1)x100% = 13.64%.\n<\/p>\n
\nIn general, if an investment loses x% this year, its result will need to grow by (1\/(1-x\/100) – 1)x100% next year to break even. So, by the example above, an investment that loses 12% this year will need to gain
\nSource:\n<\/p>
\nKillip, Brian T. Mathematics for Business: The CGA Reference Handbook<\/em>. Toronto: Harcourt Brace and Company, 1993.\n<\/p>\nJack of Oracle Tutoring by Jack and Diane,<\/a> Campbell River, BC. \n\n","protected":false},"excerpt":{"rendered":" Self-tutoring about math: the tutor mentions perhaps an oft-considered question. Suppose an investment loses x% this year. What percent does the resulting sum need to gain next year in order to break even? Imagine an investment of initial value $250. …<\/p>\n