“New York, NY (AP, Nov. 20, 2017) – Salvador Dali’s iconic painting, “The Persistence of Memory” of 1931 – considered the Catalan surrealist’s most universally recognized work and originally sold to its long-time owner, the Museum of Modern Art, for just $250 – fetched a record-breaking $550 million Monday evening at Sotheby’s auction house here.”
ALERT: This is fake news! The Museum did not sell the painting. However the stated price, while surprising, would not be that unusual.
However, for this problem, assume that the Museum paid $12,500 for the painting in 1931 and sold it for a record-breaking $550 million in 2017. What rate of return did the Museum of Modern Art get after this sale?