Question

Joyce's mother buys some shares of Company A on Day 0.

On Day 7, the share price of Company A is $4.60.
If she sells all her shares of Company A and A buys 2000 shares of Company B on Day 7, she would receive $7400.
On Day 12, the share price of Company A is $4.80 and the share price of Company B is $0.50 less than that on Day 7.
If she sells all her shares of Company A and buys 5000 shares of Company B on Day 12, she would have to pay $5800. Find
(i) the number of shares of Company A Joyce's mother has,
(ii) the share price of Company B on Day 12.

Please help aNd thank you!!!​

Answer 1

(i) 4000

(ii) $5.00

Explanation:

Let no. of shares of Company A be X

Let share price of Company B on Day 7 be $y

Share price of Company B on Day 12 = $(y-0.50)

(i)

Consider Day 7:

4.60x - 2000y = 7400................ (1)

Consider Day 12:

4.80x - 5000(y-0.50) = -5800

4.80x - 5000y + 2500 = -5800

4.80x - 5000y = -8300............... (2)

(1)*2.5:

11.5x - 5000y = 18500................. (3)

(3)-(2):

11.5x - 4.80x - 5000y + 5000y = 18500 + 8300

6.70x = 26800

x = 4000

(ii)

Sub. x = 4000 into (1):

4.60(4000) - 2000y = 7400

-2000y = 7400 - 18400

-2000y = -11000

y = 5.5

Share price of Company B on Day 12

= 5.50 - 0.50

= $5.00