Question

Marcus purchased 80 shares of stock in a computer company at $74.19 per share and Taylor purchased 65 shares of stock in a different computer company for $85.21 per share. After holding the stock for two years, Marcus sold his for a total of $6,404.57, and Taylor sold hers for a total of $6,192.83. Which person had a higher ROI and by how much?

Marcus: 3.9% more

Taylor: 3.9% more

Marcus: 7.9% more

Taylor: 11.8% more

Answer 1

@NaCl

Answer 2

@ivettef365 @mathmate

Answer 3

ROI=(selling price - purchase price)/purchase price
Example:
for Marcus, ROI=(( 6,404.57/80)-74.19)/74.19=7.91%

Answer 4

so now what??

Answer 5

Calculate the ROI for Taylor and compare which is more profitable.

Answer 6

I got 0.983 for Taylor is that correct @mathmate

Answer 7

Not quite. What is the expression to get that?

Answer 8

6129.83-5538.65/6129.83 = 0.096 I tried it again and got this

Answer 9

Taylor's investment is 5538.65, so you really want to divide by his investment, instead of the market value.

Answer 10

i dont understand im sorry

Answer 11

The definition of ROI is
gain/cost
gain is 6192.83-5538.65 (as you had it)
but
cost is what he paid, which is 5538.65
so the ROI = (6192.83-5538.65)/5538.65

Answer 12

Ok gotcha, I got 0.118

Answer 13

Now you only have to compare the two ROI and see which one is more profitable.

Answer 14

So how would I do that

Answer 15

The question asks who has a higher ROI, can you tell me who has a higher ROI?

Answer 16

Note: ROI means return on investment.

Answer 17

And after that, you would subtract the lower from the higher ROI and then make your choice from the 4 choices given.

Answer 18

Oh Taylor ? So it would be D ?

Answer 19

Ouch!
They did not ask what the ROI's are. They are asking the difference between the two ROIs.

Answer 20

ITS C. 7.9

Answer 21

7.9 is Marcus's ROI, not the difference between the 2.
You have to choose from the remaining choices depending on whose ROI is higher.
Go ahead!

Answer 22

i want to say B

Answer 23

because...

Answer 24

Because Taylors ROI is higher?

Answer 25

Right! Good job!

Answer 26

thanks so much for your help i appreciate it!

Answer 27

You're very welcome!
Wish you great success with your studies!