Final answer:
Mike sold two horses for $18,000 each, with a 20% gain on one and a 20% loss on the other. After calculating the cost price of each horse to be $15,000, we determine that Mike made a $3,000 profit on one horse and a $3,000 loss on the other, resulting in a net total gain or loss of $0.
Step-by-step explanation:
The subject of the question involves understanding the concept of percentage gain and loss in Mathematics, specifically relating to transactions like buying and selling assets. Mike sold two horses for $18,000 each. On one, he gained 20% and on the other he lost 20%. To find the total gain or loss, we need to calculate the cost price for each horse.
For the horse he gained 20% on, the cost price would be $18,000 / (1 + 0.20) = $15,000. For the horse he lost 20% on, the cost price would be the same formula, which again is $15,000 because the selling price and percentage loss are the same.
Now, we look at the net outcome. For the first horse, the profit is $18,000 (selling price) - $15,000 (cost price) = $3,000. For the second horse, the loss is the same amount, $3,000. Therefore, when you combine the two transactions, Mike's total gain or loss is $3,000 (profit) - $3,000 (loss) = $0.