Anybody good with finance or math?

I guess it is all in how you look at it. You know there are three great lies in this word- Lies, Damn Lies and Statistics.

If you double your investment, you have increased it by 100%. Using that logic, 4M doubled= 8M; 8M doubled= 16M (another 100% increase) 16M doubled= 32M (another 100%) and 32M doubled= 64M (another 100%) so someone at Enron would probably say his investment was less than 400%.

Actually, if he ended up with $60 million, and that includes the $4 million he started with, that would mean he made a profit of $56 million, or 1,400 %.

-- Charlie M. "Woodworking - patience = firewood"

yup i knew my math was off…thank’s much for helping me look like I know what I am talking about!

charlieM1958’s way is the correct answer. Mathematically if you’re interested, (all figures in Mns): Net profit in amount is $60 – $4=$56. Increase in investment (or profit) in % = $56 / $4×100% = 1,400%

-- The time I enjoy wasting is not time wasted

His ROI is 1,300% but generally you need a time frame, If he invested $4 today and got back $56 tomorrow his return would be almost infinite, if it took 20 years the return would be much lower and you need a calculator (or google) to figure it out.

http://www.money-zine.com/Calculators/Investment-Calculators/Return-on-Investment-Calculator/

-- Paul, Beaverton OR, www.TravelbyPaul.com

If I read mission76’s question correctly, his was about % of increase in the employees’ money from $4 Mn to $60Mn. The 1,400% is a measure of the absolute increase in %.

Using the Return on Investment Calculator provided by Paul, the ROI was 1,400% if we used a static time frame: i.e. the investment start date and the end date are the same. Not sure how the 1,300% figure was arrived at.

If my assumptions are correct, I don’t think mission76 has such info. as the start dates and end dates of the employees’ investments (the lump sum was $4Mn and it was likely the investments consisted of various investments with different start and end dates).

-- The time I enjoy wasting is not time wasted

the real equation should read:

RG-1M=1PNM+1M

Translated: Rich Guy minus $1million= 1 Poor NapaMan +$1million…

That would be a nice end you your paper…it would be a good story at least…

-- Matt, Napa, CA...fun is beautiful...just trying to have some fun...

Oh man I wish I had some of you guys when I was trying to explain special purpose entities in the paper…this business stuff is killing me, I was a science major in undergrad, last paper for this grad course and of course it is turning out to be far more difficult for me then I thought…

BTW I just went with 1400…thanks again

I’m glad this liberal arts major (Communications, with minors in Poli Sci and Sociology) was able to answer your math question, LOL!

-- Charlie M. "Woodworking - patience = firewood"