An investment earned 6% compounded semiannually for two years and 8% compounded annually for the next three years. What was the equivalent annually compounded rate of return for the entire five-year period?

Compounded Semiannually

The calculation of interest where the earned interest is added to the principal every six months, resulting in interest on interest.

Compounded Annually

Interest calculation on a loan or investment once per year where each year's interest is added to the principal.

Rate of Return

The increase or decrease in the value of an investment over a certain time frame, represented as a percentage of the investment's original price.