Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.7 The Stock Market

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Financial Algebra 1st Edition Chapter 1 The Stock Market

Page 42 Problem 1 Answer

Given: Rob purchased stock and he sold it at a loss.

To find: Express his net proceeds algebraically.

We will find the difference in the stock purchased and the stock sold.

For purchasing the total money spent will be p+40 and when the stock is sold, we get the net money by removing brokerage fee as h−1%h=0.99h.

Hence, we will get the net proceeds as 0.99h−(p+40)=0.99h−p−40.

Thus, we can say that when Rob purchased stock and he sold it at a loss then his net proceeds algebraically will be 0.99h−p−40.

Page 43 Problem 2 Answer

Given:

Financial Algebra, 1st Edition, Chapter 1 The Stock Market 2

To find: How do those words apply to an investor? How do those words apply to a stockbroker?

We will use the statement as per the definition with reference of the stock.

Since we know that sometimes the price of stock increases or decreases rapidly.

When we have purchases a stock but it’s value start decreasing then it will be our loss.

However, as we know that we are the pilot.

So, we can say that we will decide when we want to sell the stock and when we want to purchase more.

Thus, we can say that we will decide when we want to sell the stock and when we want to purchase more.

Cengage Financial Algebra 1st Edition Chapter 1 Exercise 1.7 The Stock Market

Page 43 Problem 3 Answer

Given that The ticker shows trades of stock in Hewlett-Packard (HPQ), Exxon- Mobil (XOM), and Chevron (CVX).

HPQ 6K47.29 ▼ 0.23 XOM 3K92.67 ▲ 0.08 CVX 9K100.38 ▼ 0.22 We have to find how many shares of Hewlett-Packard were sold

Given that Hewlett-Packard (HPQ) in the given ticket as HPQ6K47.29▼0.23 As we know that the number of shares sold will be the number oresent right side of the name of the company.

So on observing the given ticket HPQ6K47.29▼0.23

We can say that the number of shares sold as 6K  that is nothing but 6000.

There fire the number of shares sold are 6000.

Page 43 Problem 4 Answer

Given that The ticker shows trades of stock in Hewlett-Packard (HPQ), Exxon- Mobil (XOM), and Chevron (CVX).

HPQ 6K47.29 ▼ 0.23 XOM 3K92.67 ▲ 0.08 CVX 9K100.38 ▼ 0.22

We have to find what was the total value of all the HPQ shares sold

Given that Hewlett-Packard (HPQ) in the given ticket as HPQ6K47.29▼0.23

As we know that the number of shares sold will be the number present right side of the name of the company.

We can say that the number of shares sold as 6000 And we know the price per share is the number present directly to the left side after the name of the company.

That is  Price per share =47.29

Now we have the total value of the shares sold as the product of the number of shares and the price value of each share that is

Total value sale=Number of shares sold×Price per share

=6000×47.29

=283740​

Hence we have the total value of all the HPQ shares sold as 283740

Page 43 Problem 5 Answer

Given that The ticker shows trades of stock in Hewlett-Packard (HPQ), Exxon- Mobil (XOM), and Chevron (CVX).

HPQ 6K47.29 ▼ 0.23 XOM 3K92.67 ▲ 0.08 CVX 9K100.38 ▼ 0.22

Also given that broker charged her 1% commission.

We have to find the total cost of her investment.

Given that Hewlett-Packard (HPQ) in the given ticket as HPQ6K47.29▼0.23

As we know that the number of shares sold will be the number present right side of the name of the company.

We can say that the number of shares sold as 6000 And we know the price per share is the number present directly to the left side after the name of the company.

That is  Price per share =47.29

Now we have the total value of the shares sold as the product of the number of shares and the price value of each share that is

Total value sale = Number of shares sold × Price per share

​=6000×47.29

=283740​

Now we have the comission as Commission

=1%× Total value sale

=0.01×283740

=2837.40​

Now we have that the total cost of investment as the sum of total value and the comission.

Total cost of the investment

= Total value sale + Commission

=283740+2837.40

=286577.40

Hence we have the total cost of her investment as 286577.40

Page 43 Problem 6 Answer

Given that The ticker shows trades of stock in Hewlett-Packard (HPQ), Exxon- Mobil (XOM), and Chevron (CVX).

HPQ 6K47.29 ▼ 0.23 XOM 3K92.67 ▲ 0.08 CVX 9K100.38 ▼ 0.22 Also given that broker charged her 1.5% commission.

We have to find how much money did the broker receive and also need to round to the nearest cent.

Given that Exxon- Mobil (XOM)  ticket as XOM3K92.67▲0.08

As we know that the number of shares sold will be the number present right side of the name of the company.

We can say that the number of shares sold as 3000 And we know the price per share is the number present directly to the left side after the name of the company.

That is  Price per share =92.67

Now we have the total value of the shares sold as the product of the number of shares and the price value of each share that is Total value sale

= Number of shares sold × Price per share

=3000×92.67

=278010

​Now we have the comission as Commission

=1.5%× Total value sale

=0.015×278010

=4170.15​

Hence we have the commission value as $4170.15

Page 43 Problem 7 Answer

Given that The ticker shows trades of stock in Hewlett-Packard (HPQ), Exxon- Mobil (XOM), and Chevron (CVX).

HPQ 6K47.29 ▼ 0.23 XOM 3K92.67 ▲ 0.08 CVX 9K100.38 ▼ 0.22

Also given that her discount broker, who charges $28 per transaction.

We have to how much money did Lisa receive from the above sale after the broker took his fee

Given that Chevron (CVX) ticket as CVX9K100.38▼0.22

As we know that the number of shares sold will be the number present right side of the name of the company.

We can say that the number of shares sold as 9000 And we know the price per share is the number present directly to the left side after the name of the company.

That is  Price per share =100.38

Now we have the total value of the shares sold as the product of the number of shares and the price value of each share that is

Total value sale=Number of shares sold×Price per share

​=9000×100.38

=903420

 

Now we have the  the profit of the sale is the total price value subtracted with the broker fees that is Profit of the sale

= Total value sale − Broker fee

=903420−28

=903392

The amount of money Lisa receive from the above sale after the broker took his fee is 903392

Page 44 Problem 8 Answer

Given: Lenny bought x  shares of stock for $y per share last month. He paid his broker a flat fee of $20 He sold the stock this month for $p per share, and paid his broker a 2% commission.

To express Lenny’s net proceeds algebraically.We will get the purchase price and the selling price to get the net proceeds.

purchase price of x shares = xy

total purchase  cost = xy+20

Selling price of the shares will be= xp

Total selling cost = xp−0.02xp

Hence it is given by: 0.98xp

Therefore the net proceeds will be:

Net proceeds = total selling cost – total purchase  cost

= 0.98 x p-(xy+20)

=x(0.98p-y)-20

Lenny’s net proceeds is given by: x(0.98p−y)−20

Page 44 Problem 9 Answer

Given:  Darlene purchases $20,000 worth of stock on her broker’s advice and pays her broker a 1.5 % broker fee.

She sells her stock when it increases to $28,600 two years later, and uses a discount broker who  charges $21per trade.

To compute Darlene’s net proceeds after the broker fees are taken out.We will get the purchase price and the selling price to get the net proceeds.

The purchase price = Price of shares bought + the broker fees.

Hence the total purchase will be 20,000

Selling price of shares =28600

Total selling cost will be ⇒28600−21=28579

Net proceeds = total selling cost – total purchase  cost

Net proceeds ⇒28579−20300=8279

Darlene’s net proceeds after the broker fees are taken out is $8279.

Page 44 Problem 10 Answer

Given: Ron bought x dollars worth of stock and paid a y percent commission.

Dave purchased p dollars worth of stock and paid a q percent commission, where x>p.

To pick numbers for x,y,p,q such that  Ron’s commission is less than Dave’s. We will get the purchase price for both.

Purchase price of shares for Ron is given to be x.

Hence commission Ron paid is: (y/100)x=xy/100

Purchase price of shares for Dave is given to be y.

Hence commission that Dave paid will be (q/100)p=pq/100

Therefore for Ron’s commission to be less than Dave we have:​

xy/100<pq/100

xy<pq  since  q/y>x/p>1​

For Ron’s commission to be less than Dave we must have: xy<pq

Chapter 1 Solving Linear Equations

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