Ten years ago, Tom purchased a painting for $300. The painting is now worth $1,020. Tom could have deposited $300 in a savings account paying 12 percent interest compounded annually
Which of these two options would have provided Tom with a higher return?
Using financial calculator: PV =- $300, FV = $1,020, n = 10, PMT =0, CPT I: 13%
Painting has a higher return (13 percent) in comparison to the 12 percent rate of return from the savings account.
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