The investment Research Institute reported in its Mutual Fun

The investment Research Institute reported in its Mutual Fund Fact Book that the number of mutual funds increased from 4725 in 1999 to 7977 in 2015. What is the geometric mean annual percent increase in the number of funds?

Solution

As

A = Ao(1+r)^n

Then

7977 = 4725(1+r)^(2015-1999)

7977 = 4725(1+r)^16

1.688253968 = (1+r)^16

r = 0.033272477 or 3.33% [ANSWER, D]