Question

Zeke bought 10 shares of a company's stock at a price of 21.20 per share. He now sees that the price per share of his investment is32. His broker informs him that the price of the shares may see a decline in the future. Zeke should ideally _______ the assets because he stands to earn a profit of _______ per share from the transaction.

1) sell, $10.80
2) buy, $10.80
3) sell, $32
4) buy, $32

Answer 1

Zeke should sell his assets because he stands to earn a profit of $10.80 per share Zeke should sell his shares for a profit of $10.80 per share, calculating the difference between the purchase price and current price per share and then multiplying by the number of shares he owns.

Step-by-step explanation:

To maximize his profit, Zeke should sell his assets because the price per share of the company's stock has increased from $21.20 to $32. By selling the 10 shares, Zeke stands to earn a profit of $10.80 per share, which is the difference between the selling price ($32) and the buying price ($21.20). Therefore, the ideal option for Zeke is to sell the assets and earn a profit of $10.80 per share from the transaction.

Zeke should sell his shares for a profit of $10.80 per share, calculating the difference between the purchase price and current price per share and then multiplying by the number of shares he owns.

Zeke should ideally sell the assets because he stands to earn a profit of $10.80 per share from the transaction. If Zeke bought 10 shares at $21.20 each and the current price is $32 per share, the profit per share is calculated by subtracting the purchase price from the current price. Thus, the profit per share would be $32 - $21.20 = $10.80. Multiplying this by the number of shares Zeke has (10 shares), the total profit from selling all shares would be $10.80 x 10 = $108.