An investment increases by 20% in the first year and then decreases by 10% in the second year. What is the net percentage change over the two years?

✓ Correct Answer: Option A

Assume initial investment is 100. After a 20% increase, it becomes 100 * 1.20 = 120. After a 10% decrease, it becomes 120 * 0.90 = 108. The net change is (108 - 100) = 8, so an 8% increase.