Question

A person sold 100 shares of stock at a loss of 40%. If the selling price for the 100 shares was $3,000, which of the following comes closest to what was paid for the stock?

Answer 1

Loss of value is calculated according to the original price.
If the shares were sold at $3,000, and this was a loss of 40%, then the purchase price x is related to the 40% loss by the equation:
(3000 - x) / x = -40%
3000 - x = -0.4x
3000 = 0.6x
x = $5000