To calculate the total amount gained during the two years, we first need to calculate the return on the stock investment.
In the first year, the stock increases by 9%, so the value of the stock investment after the first year would be 60% of $5,000 increased by 9%:
$5,000 * 0.60 * 1.09 = $3,270
In the second year, the stock loses 4% of its value, so the value of the stock investment after the second year would be:
$3,270 * 0.96 = $3,139.20
The total gain from the stock investment over the two years would be:
$3,139.20 - $3,000 = $139.20
Now, let's calculate the total amount gained if all of the investment had been left in the savings account.
The total amount in the savings account after two years would be:
$5,000 - $3,000 = $2,000
The interest earned on the savings account over two years would be:
$2,000 * 0.049 * 2 = $196
Therefore, if all of the investment had been left in the savings account, the gain would have been $196 over the two years.
The total gain during the two years is:
$139.20 + $196 = $335.20
Therefore, the total amount gained during the two years is $335.20.
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You save $5,000.00 and invest 60% of it in stocks while leaving the rest in a savings account earning a 4.9% APR. The stock increases 9% in the first year and loses 4% of its value the second year. What is the total amount gained during the 2 years? What would the gain have been if all of the investment had been left in the savings account?
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