Answer:
The value of the fund today is $13831.72
Explanation:
Let us calculate the value at the end of each year, step by step. An annual decrease of 3% corresponds to a multiplier 1.0-0.03 = 0.97. An increase of 7% corresponds to 1.07.
Value at the end of
year 1: 12000 * 0.97
year 2: 12000 * 0.97 * 0.97
year 3: 12000 * 0.97 * 0.97 * 1.07
year 4: 12000 * 0.97 * 0.97 * 1.07 * 1.07
year 5: 12000 * 0.97 * 0.97 * 1.07 * 1.07 * 1.07 = 13831.72
The value of the fund today (end of year 5) is $13831.72
