Abby purchased 100 shares of her dad’s favorite stock for $25.80 per share exactly 1 year ago, commission free. She sold it today for a total amount of $2865. She plans to invest the entire amount in a different corporation’s stock today, but must now pay a $50 commission fee. If she plans to sell this new stock exactly 1 year from now and realize the same return as she has just made, what must be the total amount she receives next year? Include the commission fee as a part of the purchase price, but neglect any tax effects.
Abby purchased 100 shares of her dad’s favorite stock for $25.80 per share exactly 1 year ago, commission free. She sold it today for a total amount of $2865. She plans to invest the entire amount in a different corporation’s stock today, but must now pay a $50 commission fee. If she plans to sell this new stock exactly 1 year from now and realize the same return as she has just made, what must be the total amount she receives next year? Include the commission fee as a part of the purchase price, but neglect any tax effects.
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter13: Investing In Mutual Funds, Etfs, And Real Estate
Section: Chapter Questions
Problem 9FPE
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Question
Abby purchased 100 shares of her dad’s favorite
stock for $25.80 per share exactly 1 year ago, commission
free. She sold it today for a total amount of
$2865. She plans to invest the entire amount in a
different corporation’s stock today, but must now
pay a $50 commission fee. If she plans to sell this
new stock exactly 1 year from now and realize the
same return as she has just made, what must be the
total amount she receives next year? Include the
commission fee as a part of the purchase price, but
neglect any tax effects.
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