Question

What is the rate of return when 15 shares of Stock

A, purchased for $30/share, are sold for $500? The
commission on the sale is $6.
Rate of Return = [?] %

Answer 1

The rate of return is 1665%.

Step-by-step explanation:

To calculate the rate of return, we need to first calculate the total cost of purchasing the shares, which is given by multiplying the number of shares by the purchase price:

Total cost = 15 shares * $30/share = $450

Next, we need to calculate the total revenue from selling the shares, which is given by multiplying the number of shares by the selling price:

Total revenue = 15 shares * $500/share = $7500

Now, we can calculate the net profit by subtracting the commission from the total revenue:

Net profit = Total revenue - Commission = $7500 - $6 = $7494

Finally, we can calculate the rate of return by dividing the net profit by the total cost and multiplying by 100:

Rate of return = (Net profit / Total cost) * 100 = ($7494 / $450) * 100 = 1665%