Question

Elliott purchased shares of Microsoft in 2016 for $52.50 per share. He plans to sell them as soon as the price rises 20%. At what price will he sell his shares?

Answer 1

Elliott will sell his shares at a price of $63.00 per share after a 20% increase.

Step-by-step explanation:

To calculate the selling price at a 20% gain, you can use the following formula:

[text{Selling Price} = text{Purchase Price} times (1 + text{Gain Percentage})]

In this case:

- (text{Purchase Price}) is $52.50 per share.

- (text{Gain Percentage}) is 20%, expressed as 0.20.

Now, substitute these values into the formula:

[text{Selling Price} = 52.50 times (1 + 0.20)]

[text{Selling Price} = 52.50 times 1.20]

[text{Selling Price} = 63.00]

Therefore, Elliott plans to sell his shares at a price of $63.00 per share when the price rises by 20%.