Question

2. Angelika wants to invest $6000 in a hot new stock

named Genma, which helps students study math
What would be the better option?
- Option A, broker charging 2% brokerage
- Option B, trade with an app that charges a flat brokerage
fee of $3 per trade.
Explain which offer is better in maths and words.

Answer 1

Option B, trade with an app that charges a flat brokerage

fee of $3 per trade.

Explanation:

1) In option A, the broker charges 2% brokerage. This means that 2% of the money invested goes to the broker. Since Angelika wants to invest $6000, the amount of money to be charged by the broker = 2% of $6000 = 0.02 * $6000 = $120

2) Option B uses an app that charges a flat brokerage of $3 per trade. This means that for any transaction, the money to be charged would be $3. Since Angelika wants to invest $6000, the amount of money to be charged by the broker = $3