Question

Bobby bought 550 shares of stock at $61.25 per share. His broker charges 4% commission for round lots and 5% for odd lots. Calculate the total cost of the stock purchase.

Answer 1

The total cost of the stock purchase was $ 35,371.87.

Step-by-step explanation:

Since Bobby bought 550 shares of stock at $ 61.25 per share, and his broker charges 4% commission for round lots and 5% for odd lots, to calculate the total cost of the stock purchase the following calculation must be performed:

Odd lot = less than 100 shares, or sum not divisible by 100

550 = odd lot

(550 x 61.25) x 0.05 = X

33,687.5 x 0.05 = X

1,684.375 = X

33,687.5 + 1,684,375 = 35,371,875

Therefore, the total cost of the stock purchase was $ 35,371.87.