Question

Yoezer bought 25 shares that had a face value of Nu 100 but were selling at a discount of 5%. A 15% dividend rate was paid at the end of one year. He then sold the stock at a 5% premium.

a. What was the total amount Yoezer paid for the 25 shares initially?

A) Nu 2,375
B) Nu 2,500
C) Nu 2,625
D) Nu 2,750

Answer 1

The total amount Yoezer paid for the 25 shares initially is Nu 2,375.

Step-by-step explanation:

To find the total amount Yoezer paid for the 25 shares initially, we need to calculate the purchase price per share. The face value of each share is Nu 100, but they were selling at a discount of 5%. So, the discounted price per share is Nu 100 - (5% of Nu 100) = Nu 100 - Nu 5 = Nu 95.

Therefore, the total amount Yoezer paid for the 25 shares initially is 25 shares x Nu 95 per share = Nu 2375.