draz

I think it should be:

year 1 return: 1.12 x 0.985x 0.978
year 2 return: 1.12 x 0.978
year 3 return: 1.12 x 0.978 x 0.9925

Geometric return over 3 years:
(year1 return x year 2 return x year 3 return) ^ (1/3) -1 = answer B

Thanks for posting the question! :-)