At the end of​ 2009, right after the great recession of​ 2008-2009, business partners Mario and Luigi sold their plumbing business and retired. Each of them received​ $1,000,000 net from the sale. Mario holds an undergaduate business degree and understands​ risk, return, and divesification. He decides to invest his​ 1M$ in SPY ETF​ (essentially a stock that tracks the​ S&P 500 index​ performance). Luigi comes from a low income family and could not afford to go to college. He​ doesn't understand finance and he fears​ risk, so he decides to put his money in a bank savings account. The average​ S&P500 annual return from 2010 to 2019 has been​ 11.3%, the average annual return on a standard savings account has been​ 0.1% over the last 10 years. What is the difference in FV value​ (end of​ 2019) between Mario and Luigi investment​ holdings

Algebra and Trigonometry (6th Edition)
6th Edition
ISBN:9780134463216
Author:Robert F. Blitzer
Publisher:Robert F. Blitzer
ChapterP: Prerequisites: Fundamental Concepts Of Algebra
Section: Chapter Questions
Problem 1MCCP: In Exercises 1-25, simplify the given expression or perform the indicated operation (and simplify,...
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At the end of​ 2009, right after the great recession of​ 2008-2009, business partners Mario and Luigi sold their plumbing business and retired. Each of them received​ $1,000,000 net from the sale. Mario holds an undergaduate business degree and understands​ risk, return, and divesification. He decides to invest his​ 1M$ in SPY ETF​ (essentially a stock that tracks the​ S&P 500 index​ performance). Luigi comes from a low income family and could not afford to go to college. He​ doesn't understand finance and he fears​ risk, so he decides to put his money in a bank savings account. The average​ S&P500 annual return from 2010 to 2019 has been​ 11.3%, the average annual return on a standard savings account has been​ 0.1% over the last 10 years. What is the difference in FV value​ (end of​ 2019) between Mario and Luigi investment​ holdings?
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