Will fan & medal.
Bowen purchases 80 shares of a stock for $31.96. In 6 years, he sells the stock for $2,743.31. He calculates his ROI, shown below. Did he do this correctly? If not, what error did he make?

A. Yes, he solved it correctly.
B. No, he divided by the wrong number.
C. No, he should have a negative ROI.
D. No, he incorrectly calculated his initial investment

Question

Will fan & medal.
Bowen purchases 80 shares of a stock for $31.96. In 6 years, he sells the stock for $2,743.31. He calculates his ROI, shown below. Did he do this correctly? If not, what error did he make?

A. Yes, he solved it correctly. 
B. No, he divided by the wrong number. 
C. No, he should have a negative ROI. 
D. No, he incorrectly calculated his initial investment

leozap1 · Answer

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leozap1 · Answer

I think it's D. The question states that each stock cost $31.96. In the problem, he put $31.95

jim_thompson5910 · Answer

`Bowen purchases 80 shares of a stock for $31.96`
so his total initial investment is 80*31.96 = 2,556.80

The initial investment is NOT 80*31.96*6 = 15,340.8
since he's only buying the 80 stocks at one time for that one year. Not buying 80 stocks at that price each year for 6 years

jim_thompson5910 · Answer

So I agree that `D. No, he incorrectly calculated his initial investment` is the correct answer

leozap1 · Answer

Thank you! :)

jim_thompson5910 · Answer

np