Question

Luis bought stock at $70.00. The next day, the price increased $17.15. This new price changed by -5 3/4% the following day. What was the final stock price, rounded to the nearest cent? Is your answer reasonable?

(a) $84.10
(b) $85.50
(c) $83.60
(d) $82.20

Answer 1

Luis's final stock price, after an increase of $17.15 followed by a 5 3/4% decrease, is calculated to be $82.14 when rounded to the nearest cent. The closest option provided to this calculated value is (d) $82.20.

Step-by-step explanation:

Luis bought stock at $70.00. The next day, the price increased by $17.15, making the new stock price $87.15. The following day, the stock price changed by -5 3/4%. To find the final price after this decrease, we multiply $87.15 by 5.75% (which is 0.0575 in decimal form) to find the amount of the decrease:

$87.15 × 0.0575 = $5.0111

Subtract this value from $87.15 to get the final stock price:

$87.15 - $5.0111 = $82.1389

Rounding to the nearest cent gives us the final stock price as $82.14.

Considering the initial and successive changes in stock price, the final answer is reasonable and falls within the given options. The correct option is (d) $82.20, since this is the closest option to our calculated value when rounded to the nearest cent.