contestada

You purchase a stock at $100 per share. It drops 40% the next day; however, a week later, it increases in value by 40%. If you sell it, will you break even? Explain your answer.

Respuesta :

Answer:

No

Step-by-step explanation:

You start off with $400 and it drops 40%. Then the price dropped all the way down to $240. If it goes up another 40% of 240, that'll be $336. So you lost around $64

lhmarianateixeira

In this exercise we have to use our knowledge of finance to analyze the given situation and identify if a break even occurs, so we have:

Yes, you will have a break even, as you lose 16 dollars per sale.

First we have to analyze what the break even is, this would be:

  • In commerce and trade, particularly cost accounting, the break-even point (BEP) exist the point at that cost or expense and profit exist equal: there happen no total amount of money lost or gain, and individual bear "crushed even". In the linear case the break-even point happen effective the established costs detached for one contribution room around something for one.

Returning to the question, we have that:

[tex]100-40\%= 60\\60+40\%=84\\100-84=16[/tex]

See more about finances at brainly.com/question/10024737

Otras preguntas