I’m on page 615 (Reading #15, example number 9 in CFAI text). In the second question, it asks us to calculate the long term sustainable earnings growth rate using data from ‘95-‘08. I am not understanding how they are getting 7.5% and 4.6% (China and India’s long-term growth of labor productivity). There’s a footnote at the end of the question saying “calculated as gerometric mean growth rate using data from 1995-2005 and 2005-2008. Can anyone show me the correct calculation to get those numbers?作者: Londonrocks 时间: 2013-4-28 08:56
1995-2005 period : ( value at end / value at beginning ) ^ (1/9) - 1?
and
2005-2008 period: ( value at end / value at beginning ) ^ (1/3) - 1?
The readings have changed - and I do not have access to the tables above … but this is what I think it would be.作者: kim226 时间: 2013-4-28 08:56