Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market

Page 57 Problem 1 Answer

Let’s follow the corporation Ipath.B Sugar (SGGB) between August 13, 2018 and September12,2018.

Now, we will write the WPO daily.

WPO Daily

The bar is red, if the opening price is larger than the closing price .

The bar is green, if the closing price is larger than the opening price,

The bar is bounded vertically by the opening price and the closing price, and all the bars need to have the same width.

The lowest point of the vertical line attached to the bottom of a bar represents the low price of the day.

The highest point of the vertical line attached to the top of a bar represents the high price of the day.

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Volume

The height of the bars has to be equal to the volume, while the width of all bars has to be the same.

The bar is colored red if and only if the shares were mainly sold.

The bar is colored green if the shares were mainly bought.

We get the graph :

We have discussed the trend over the three-weeks and include any major corporate news that might have affected the trend and we get the graph :

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Solutions

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 57 Problem 2 Answer

We have to discuss the possibility of purchasing shares of stock for a corporation you are interested in following .

Answer

When purchasing stocks, you must consider all relevant aspects, such as the company’s present financial/economic condition, the country’s financial/economic status, the financial/economic situation of the company’s major consumers, and so on.

This is significant since all of these factors have an impact on stock market pricing.

It is critical to purchase stocks at the correct time for the proper firm, namely when the stock price is low and the stock price is predicted to climb (much) in the near future.

Furthermore, it is critical to sell the stocks at the proper time in order to maximize your profit, specifically when the stock’s value is high and when the stock’s value is projected to decline (significantly) in the near future.

A stock market’s value can fluctuate dramatically over a short period of time, thus it’s critical to maintain watch of changes (increases/decreases) in stock prices on a regular basis, so you can move quickly if you anticipate a change in stock value.

You should also take as little time as possible to make any decision (sell/buy), because the stock market can move quickly, and if you wait too long to make a decision, you may lose money.

We have discussed the possibility of purchasing shares of stock for a corporation you are interested in following .

When purchasing stocks, you must consider all relevant aspects, such as the company’s present financial/economic condition, the country’s financial/economic status, the financial/economic situation of the company’s major consumers, and so on.

This is significant since all of these factors have an impact on stock market pricing.

It is critical to purchase stocks at the correct time for the proper firm, namely when the stock price is low and the stock price is predicted to climb (much) in the near future.

Furthermore, it is critical to sell the stocks at the proper time in order to maximize your profit, specifically when the stock’s value is high and when the stock’s value is projected to decline (significantly) in the near future.

A stock market’s value can fluctuate dramatically over a short period of time, thus it’s critical to maintain watch of changes (increases/decreases) in stock prices on a regular basis, so you can move quickly if you anticipate a change in stock value.

You should also take as little time as possible to make any decision (sell/buy) because the stock market can move quickly, and if you wait too long to make a decision, you may lose money.

Page 57 Problem 3 Answer

It is given that : Survey your classmates and compile a list of questions your class has about stocks. Compile a list of the top five stocks they are interested in.

We have to report our findings.

Answer

When purchasing stocks, you must consider all relevant aspects, such as the company’s present financial/economic condition, the country’s financial/economic status, the financial/economic situation of the company’s major consumers, and so on.

This is significant since all of these factors have an impact on stock market pricing.

It is critical to purchase stocks at the correct time for the proper firm, namely when the stock price is low and the stock price is predicted to climb (much) in the near future.

Furthermore, it is critical to sell the stocks at the proper time in order to maximize your profit, specifically when the stock’s value is high and when the stock’s value is projected to decline (significantly) in the near future.

A stock market’s value can fluctuate dramatically over a short period of time, thus it’s critical to maintain watch of changes (increases/decreases) in stock prices on a regular basis, so you can move quickly if you anticipate a change in stock value.

You should also take as little time as possible to make any decision (sell/buy) because the stock market can move quickly, and if you wait too long to make a decision, you may lose money.

From our findings we get that :

When purchasing stocks, you must consider all relevant aspects, such as the company’s present financial/economic condition, the country’s financial/economic status, the financial/economic situation of the company’s major consumers, and so on.

This is significant since all of these factors have an impact on stock market pricing.

It is critical to purchase stocks at the correct time for the proper firm, namely when the stock price is low and the stock price is predicted to climb (much) in the near future.

Furthermore, it is critical to sell the stocks at the proper time in order to maximize your profit, specifically when the stock’s value is high and when the stock’s value is projected to decline (significantly) in the near future.

A stock market’s value can fluctuate dramatically over a short period of time, thus it’s critical to maintain watch of changes (increases/decreases) in stock prices on a regular basis, so you can move quickly if you anticipate a change in stock value.

You should also take as little time as possible to make any decision (sell/buy), because the stock market can move quickly, and if you wait too long to make a decision, you may lose money.

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 57 Problem 4 Answer

It is given that : Visit a local bank and ask to speak to one of the representatives about United States Savings Bonds.

Find out about the forms necessary to purchase a bond, the interest it pays, and how long the bonds take to reach their face value.

We have to prepare a report and present our findings to the class.

Answer

When we buy a bond, we’re really buying a debt security since the borrower sells bonds to investors, who then lend money to the borrower for a set length of time.

The borrower will subsequently be responsible for repaying the bond (at an increased value, determined by the interest rate of the bond).

A bond can be purchased through a bank or other financial institution, as well as through the US Treasury’s Treasure Direct website.

You will only need to create an account and put in your personal information if you use the website to buy bonds. All bonds are now available in electronic format.

The current bond interest rate is about0.10%

(in2018). People who bought bonds decades ago, on the other hand, may be receiving interest rates as low as (so bonds are currently less attractive as they were several decades ago).

A bond’s face value can be reached in as little as 20

years (as the treasury promised that you would double your investment in less than20

years, while your initial investment is half of the face value).

By our we findings we get that :

When we buy a bond, we’re really buying a debt security since the borrower sells bonds to investors, who then lend money to the borrower for a set length of time.

The borrower will subsequently be responsible for repaying the bond (at an increased value, determined by the interest rate of the bond).

A bond can be purchased through a bank or other financial institution, as well as through the US Treasury’s Treasure Direct website.

You will only need to create an account and put in your personal information if you use the website to buy bonds.

All bonds are now available in electronic format.

The current bond interest rate is about.10 %(in 2018). People who bought bonds decades ago, on the other hand, may be receiving interest rates as low as (so bonds are currently less attractive as they were several decades ago).

A bond’s face value can be reached in as little as 20 years (as the treasury promised that you would double your investment in less than 20 years, while your initial investment is half of the face value).

Page 58 Problem 5 Answer

The New York Stock Exchange offers many different types of publications.

And, some of these publications are:

NYSE American Options Closing-Only LessOptions fee scheduleOnly \& Batch Extract SpecificationsLate Close ListCMT Fact SheetCMT User request and Authorization FormPenny Pilot ReportTPID List

Furthermore, a monthly report on the impact of Limit Up/Limit Down and Straddle States on options trading is made public each month.

A list of publications that the Exchange offers are :

NYSE American Options Closing-Only LessOptions fee schedule only \& Batch Extract SpecificationsLate Close ListCMT Fact SheetCMT User request and Authorization FormPenny Pilot ReportTPID List

Furthermore, a monthly report on the impact of Limit Up/Limit Down and Straddle States on options trading is made public each month.

Page 58 Problem 6 Answer

Here we have to do, Is to set up of portfolio for a students of 5 to 10 and track the gains and losses of entire month Firstly select students of 5−10

Use stocks like S&P500, Dow Jones We have an investment of 10,000 $

firstly we have to divide the investment for the companies and know how many stocks we own so, we know that in the stock market the profit and loss will vary from the day-day basis

analyze and obtain a value of how much do we get for an entire month and if we didn’t obtain the required repeat until you reach it.

Therefore, Determine the loss and gains as a day-day Comparision and if didn’t obtain any profit then repeat it for an entire month

Cengage Financial Algebra Chapter 1 Assessment Stock Market Answers

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 58 Problem 7 Answer

Given; The payment for a job is to be paid for 30 days of June such that on  2nd day, the payment was 1 cent. 2nd day, the payment was 2 cents. 3rd day, it was 4 cents.

In this way, each day the payment was twice the amount of the previous day.

To find; Draw a grid with six columns and five rows to represent the 30 days

How much do you receive on June 14? June 27? June 30 we have The payment for a job is to be paid for 30  days of June such that on 1st day, the payment was 1 cent.

2nd  day, the payment was 2 cents. 3rd  day, it was 4 cents.

In this way, each day the payment was twice the amount of the previous day.

From the above grid, the payment on June 14 will be 8,192cents.

From the above grid, the payment on June 27 will be 67,108,864 cents.

From the above grid, the payment on June 30 will be 536,870,912 cents.

Hence we cocnluded that From the above grid, the payment on June14 will be 8,192 cents.

From the above grid, the payment on June 27 will be 67,108,864 cents .

From the above grid, the payment on June 30 will be 536,870,912 cents.

Page 59 Problem 8 Answer

Given the money to start the business is 73,000 $ and their ratio is 3:7

To do: Find how much did they invest

The given ratio is  3:7 so let Nick investment is 3x and Matt investment is 7x  then the total investment will be 3x+7x=10x and the total money is 73,000 $

​⇒x=73000/10

=7300

substituting for x we get Nick investment ​3x=3(7300)

=21900​

Matt investment ​7x=7(7300)

=51100​

Therefore, Nick investment is 21900 $

Matt investment is 51100 $

Page 59 Problem 9 Answer

Given the money needed to start a business is 73,000 $ the ratio is 3:7

To do: Percent of the business was owned by Matt

Given the total investment is 3x+7x=10x in this the investment of matt is 7x then the percent will be 7x/10x =0.7 which is equal to 70%

Therefore,Matt owned 70 % of the business

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 59 Problem 10 Answer

Given that Tom purchased shares of DuPont 47.65 $ per share. He plans to sell the shares when the stock price rises 20%

To do: Find the selling price

Given that there is a 20 % increase to the original price this means that the price is increased by 20% so, the cost is 1.2 then the selling price will be 57.18

Therefore, the selling price is 57.18

Page 59 Problem 11 Answer

Given that The top three shareholders in a certain corporation each own shares of a certain stock.

The corporation’s ownership is represented by a total of x  shares of stock

To do: Express the percent of the corporation owned by the top three shareholders algebraically

Let the shares owned by the three stakeholders be s then the whole stakeholder will be equal to 3s and the share of corporation is x then the percent owned will be

3s(100/x)

=300s/x

Therefore,

the percent owned is 300s/x

Page 59 Problem 12 Answer

Given that Marilyn purchased 2,000  shares of stock for 25.43 $  per share.

She sold them for 44.10 $  per share

To do: Express her capital gain

From the given data we know that total shares 2000 purchased at 25.43 $ Sold at 44.10 $ from this  the total purchase price =50860 the total selling price =88200

Net capital gain = total selling price−total purchase price

=88200−50860

=37340

​and % capital gain is (100∗37340)/50860=73.4%

Therefore, capital gain =73.4%

Solutions For Cengage Financial Algebra Chapter 1 Stock Market Assessment

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 59 Problem 13 Answer

Given that A local hairdresser bought 450  shares of a cosmetics corporation for 33.50 $  per share. He sold the shares for 39.01 $  per share

To do: From the given data we have number of shares=450

purchase price=33.5

selling price=39.01 then the percentage price​=100(39.01−33.5/33.5)

=16.4 %

​Therefore, the percentage price is 16.4 %

Page 59 Problem 14 Answer

Given that A local hairdresser bought 450  shares of a cosmetics corporation for 33.50 $ per share. He sold the shares for 39.01 $ per share

To do: Find the total purchase price

From the given data we have number of shares=450 purchase price=33.5$

selling price=39.01$ then the total purchase price is ( $33.5)(450) = $15075

Therefore, the total purchase price is  $15075

Page 57 Problem 15 Answer

Given that A local hairdresser bought 450 shares of a cosmetics corporation for 33.50 $ per share. He sold the shares for 39.01 $ per share

To do: find the total selling price

From the given data we have number of shares=450

purchase price=33.5

selling price =39.01

Then total selling price is ​450×39.01

=17,554.50 $

​Therefore, the total selling price is =17,554.50 $

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 57 Problem 16 Answer

Given that A local hairdresser bought 450 shares of a cosmetics corporation for 33.50 $ per share. He sold the shares for 39.01 $ per share

To do: Find the capital gain

We know that total selling price=17554.5

total purchase price=15075 then the net capital gain will be =17554.5−15075

=2479.5 ​then  % capital gain​=(100∗2479.5)/15075

=16.4 %

​Therefore, the %capital gain16.4%

Page 59 Problem 17 Answer

Given that the Bootle Corporation paid Leslie a quarterly dividend check for 828 $. Leslie owns 450 shares of Bootle

To do: find quarterly dividend for one share of Bootle

From the given data we know that the total number of shares=450 the dividend of all the shares is 828

so, the quarterly dividend for one share of Bootle​=828/450

=1.84

​Therefore, the quarterly dividend for one share of Bootle=1.84

Page 59 Exercise 1 Answer

Given that Aaron owned x  shares of a corporation and received an annual dividend of y dollars

To do: the quarterly dividend for one share

From the given data we have number of shares owned=x annual dividend of shares=ythen the annual dividend of 1 share=y/x then quarterly dividend of 1 share is y/4x

Therefore, the quarterly dividend of 1 share is y/4x

Page 60 Exercise 2 Answer

Given a table consisting of market data

To do: find the difference between the 52−week high and the 52−week low for one share of AT&T

From the given data we have week high of AT &T52

=42.97

week low of AT&T 52=32.95 then the difference is 42.97−32.95=10.02

Therefore, the difference is 10.02

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 60 Exercise 3 Answer

Given a table consisting of market data

To do: difference between the day’s high and low for one share of Southern Copper

From the table we have Southern copper day high=110.68

Southern copper day low=105.68 then the difference is 110.68−105.68=5

Therefore, the difference between the day’s high and low for one share of Southern Copper=5

Page 60 Exercise 4 Answer

Given a table consisting of market data

To do: find which stock had a close that was furthest from the day’s low

We have the difference between the Southern Copper corp for close and low is  and the difference of is  and difference of is and JPM organ Chase and co.

so, the stocks are IIT Ed Services furthest from day’s low

Therefore, the stocks are IIT Ed Services furthest from day’s low

Page 60 Exercise 5 Answer

Given a table consisting of market data

To do: Determine the close on June 19  for JPM organ Chase

From the given data we get June 19 close= June 20 close−change

June 19 close=37.86+0.79

=38.65

​Therefore, the June19 close=38.65

Page 60 Exercise 6 Answer

Given a table consisting of market data

To do: How many shares of ITT were traded on June 20

From the given data we have shares of ITT trades of 3429.5 then

3429.5(100)=34,29,500 were traded

Therefore, 34,29,500 shares of ITT were traded on June 20

Solutions For Cengage Financial Algebra Chapter 1 Stock Market Assessment

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 60 Exercise 7 Answer

Given a table consisting of market data

To do: The percent net change from June 19  to June 20  for AT&T

Firstly finding

June 19 close = June 20 close − change

=34.43+0.72

=35.15

then the percentage will be​

=−0.72100/35.15

=−2.048%⇒−2.05%

​Therefore, the percent change is −2.05 %

Page 60 Exercise 8 Answer

Given a table consisting of market data

To do: Find which stock had a day’s high that was approximately 30% less than its 52-week high

Given that there is 30 % less than its 52− week high this means70 % of 52 week high this gives 0.7(52) week high and the difference for Southern Copper crop=100.275

for AT&T=30.079

ITT Ed services =92.274 and JP Morgan Chase & Co.=35.336 from this we get

ITT Ed services has 30 % less than it 52−week high

Therefore, ITT Ed services have30 % less than its 52− week high

Page 60 Exercise 9 Answer

Given a table consisting of market data

To do: the difference in the number of shares traded from June 19 to June 20

From the given data we have Shares on June19=59945400

Shares on June20=55377200 and the difference between these two will be 59945400−55377200=4568200

Therefore,the difference between the trades is 4568200

Page 60 Exercise 10 Answer

Given a bar graph of stock’s

To do: What was the day’s open on June 17

From the graph, we could see that the line on June 17 lies at 49.60

so,the opening price will be 49.60 $

Therefore, the opening price on June 17 is 49.60 $

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 60 Exercise 11 Answer

Given a bar graph of stock

To do: the approximate difference between the day’s high and low on June 18

From the given graph the high June line is at 49.5  and the low line is at 48.5 and the difference between these is 49.5−48.5=1 $

Therefore, the difference between the day’s high and low on June 18 is 1 $

Page 60 Exercise 12 Answer

Given a bar graph of stock’s

To do: On what day was the close also the day’s low

From the given bar graph, we could see that the low edge on a daily basis is marked on June20

So, we can say that the close is low on that day

Therefore, On June20 the close is low

 Page 60 Exercise 13 Answer

Given a bar graph of stock’s

To do: the approximate volume for June 19

From the graph given, on the volume side, we could see that the line on June 19 is marked at 0.75 which means 0.75 millions or 750,000

Therefore, the volume for June 19 is 750,000

Page 61 Exercise 14 Answer

Given that Lea owns 800  shares of ABC  Incorporated. On April 6  the corporation instituted a 5−for−2

stock split. Before the split, each share was worth $42.60

To do: Find shares did Lea hold after the split

Given that the number of shares lea owns=800 after split​=800(5/2)

=2000

​Therefore, 2000  shares Lea hold after the split

Cengage Financial Algebra Chapter 1 Stock Market Key

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 61 Exercise 15 Answer

Given that Lea owns 800  shares of ABC, Incorporated. On April 6 the corporation instituted a 5−for−2 stock split. Before the split, each share was worth $42.60

To do: Find the post-split price per share

We know that  Post split price= 2/5 times of pre-split price

⇒2(42.6)/5

=17.04

Therefore, the post-split price is 17.04 per share

Page 61 Exercise 16 Answer

Given that Lea owns 800  shares of ABC, Incorporated. On April 6 the corporation instituted a 5−for−2  stock split.

Before the split, each share was worth $42.60

To do: Show that the split was a monetary non-event for Lea.

From the given data we have number of shares=800

price of share before the split=42.6

total investment before=34080

price share after the split=17.04

Then total investment =34080

So, we can say that split was a monetary non-event for Lea.

Therefore, The split was a monetary non-event for Lea.

Page 61 Exercise 17 Answer

Given a table of closing prices for Microsoft

To do: Find the 3−day moving averages

The 3− day  moving averages will be:

On 23−May 28.05+28.44+28.18/3

=86.67/3

⇒28.22

On 27− May 28.44+28.18+28.31/3

=84.93/3

⇒28.31

On 28− May 28.18+28.31+28.32/3

=84.81/3

⇒28.27

On 29− May 28.31+28.32+27.80/3

=84.43/3

⇒28.14

On 30− May 28.32+27.80+27.31/3

=83.42/3

⇒27.81

On 2− Jun 27.80+27.31+27.54/3

=82.64/3

⇒27.55

On 3− Jun 27.31+27.54+28.30/3

=83.14/3

⇒27.71

On 4− Jun 27.54+28.30+27.49/3

=83.33/3

⇒27.78

On 5− Jun 28.30+27.49+27.71/3

=83.50/3

⇒27.83

On 6− Jun 27.49+27.71+27.89/3

=83.09/3

⇒27.70

On 9− Jun 27.71+27.89+27.12/3

=82.72/3

⇒27.57

On 10− Jun 27.89+27.12+28.24/3

=83.25/3

⇒27.75

On 11− Jun 27.12+28.24+29.07/3

=84.43/3

⇒28.14

On 12− Jun 28.24+29.07+28.93/3

=86.24/3

⇒28.75

Therefore, the 3− day averages are  $28.22, $28.31, $28.27, $28.14, $27.81, $27.55, $27.71, $27.78, $27.83, $27.70, $27.57, $27.75, $28.14, $28.75

Page 61 Exercise 18 Answer

Given a table of closing prices for Microsoft

To do: Find the 10− day moving averages

Finding the averages of 10− days

On 23− May 28.05+28.44+28.18+…+27.49/10

=279.73/10

≈27.97

On 27− May 28.44+28.18+28.31+…+27.71/10

=279.39/10

≈27.94

On 28− May 28.18+28.31+28.32+…+27.89/10

=278.84/10

≈27.88

On 29− May 28.31+28.32+27.80+…+27.12/10

=277.78/10

≈27.78

On 30− May 28.31+28.32+27.80+…+27.12/10

=277.78/10

≈27.78

On 2− Jun 27.80+27.31+27.54+…+29.07/10

=278.46/10

≈27.85

On 3− Jun 27.31+27.54+28.30+…+28.93/10

=279.59/10

≈27.96

Therefore, the averages of 10−day are $27.97,$27.94,$27.88,$27.78,$27.77,$27.85,$27.96

Detailed Solutions For Cengage Financial Algebra Chapter 1 Assessment The Stock Market

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 61 Exercise 19 Answer

Given that [email protected]@[email protected], [email protected]

To do: How many shares did Nick buy

From the given data Nick bought 0.67K which means

0.67(1000)

=670 shares

​Therefore, Nick bought 670 shares

Page 61 Exercise 20 Answer

Given that [email protected]@[email protected], [email protected]

To do: +How much did each share cost

From the given data the cost is written after the symbol @ then each share cost rupees 5.01

Therefore, the share cost is 5.01 $

Page 61 Exercise 21 Answer

Given that [email protected]@[email protected], [email protected]

To do: the value of Nick’s trade From the given data we know that number of shares=670 price=5.01  Value of trade = no. of shares ∗ price

substituting the values we get

=(670)(5.01)

=3356.7

​Therefore, the value of trade=3356.7

Page 61 Exercise 22 Answer

Given that [email protected]@[email protected], [email protected]

To do: How many shares did he sell

From the given data,Patrick sold 1.6Kwhich means

1.6(1000)

=1600

​Therefore,

the shares he sold are 1600

Page 61 Exercise 23 Answer

Given that [email protected]@[email protected], [email protected]

To do: For how much did each share sell

The share price is the value written after @ so, each share has sold at 26.14

Therefore, each share was sold at 26.14

Page 61 Exercise 24 Answer

Given that [email protected]@[email protected], [email protected]

To do: Based on Patrick’s sale, what was the closing price of T on the previous trading day

From the given, we know that, The current price is lower than the previous day so Previous day closing =26.14+1.08

=27.22​

Therefore, the closing price is 27.22

Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market Page 61 Exercise 25 Answer

Given that The stock in a real estate corporation was selling for $78  per share with an annual dividend of $1.86

It underwent a 3−for−2 split

To do: What was the value of one share of the stock after the split

From the given data Stock price before split=78

so, the price stock after the split​=2/3(78)

=52​

Therefore, the stock after the split=52

Page 61 Exercise 26 Answer

Given that The stock in a real estate corporation was selling for $78  per share with an annual dividend of $1.86. It underwent a 3−for−2 split

To do: Find the annual dividend after the split

From the given data,it is given that the annual dividend before split=1.86then annual dividend will be after the split​=2/3(1.86)

=1.24​

Therefore,the annual dividend after the split=1.24

Page 61 Exercise 27 Answer

Given;  A stock that was selling for x per share underwent a y−for-p split.

To find: Express the annual dividend after the split algebraically.

Here we have given It was originally paying an annual dividend of d per share annual dividend before split=d it underwent y-for-p split annual dividend after split=p/y∗d=pd/y

Hence the expression for the annual dividend after the split algebraically. is pd/y

Page 61 Exercise 28 Answer

Given; Suki purchased 9,600 worth of stock and paid her broker a 1.75 % broker fee.

She had an immediate need for cash and was forced to sell the stock when it was worth 8,800.

She used a discount broker who charged 32.50  per trade

To find: Compute Suki’s net loss after the broker fees were taken out.

Purchase price: 9,600

Fee purchase: 1.75%

Selling price: 8,800

Fee sale: 32.50

The broker fee is the product of the broker fee rate of 1.75% and the purchase price:

Broker fee purchase =1.75%× Purchase price​

=0.0175×9600

=168

The total purchase cost is the sum of the purchase price and the broker fee of the purchase:

Total purchase cost = Purchase price  Broker fee purchase​

=9600+168

=9768​

The total selling cost is the selling price decreased by the broker fee of the sale (flat rate):

Total selling cost = Selling price − Broker fee sale​

=8800−32.50

=8767.50

The net loss is then the difference between the total purchase cost and the total selling cost:

Net loss = Total purchase cost −Total selling cost​

=9768−8767.50

=1000.50

Thus the net loss is 1000.50.

Hence the net loss is 1000.50. for suki after the broker fees were taken out.

Practice Problems For Cengage Financial Algebra Chapter 1 Stock Market Assessment

Chapter 1 Solving Linear Equations

• • Cengage Financial Algebra 1st Edition Chapter 1 Assessment The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.1 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.2 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.3 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.4 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.5 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.6 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.7 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.8 The Stock Market
  • Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.9 The Stock Market