Question

Now suppose you buy a stock for $3,500. It decreases in value by 3% and then rises 8%. What is the new value? Round to the nearest cent.

Answer 1

In order to find the new value, we use the formula

`NP=OP\ast(1\pm\%)`

Then, start by finding the new price after the stock decreases by 3%

`\begin{gathered} NP=3500\ast(1-0.03) \\ NP=3500\ast0.97 \\ NP=\text{ \$}3395 \end{gathered}`

Finally, rise the new price using the same formula

`\begin{gathered} NP=3395\ast(1+0.08) \\ NP=\text{ \$}3666.60 \end{gathered}`

Answer:

The new value is $3666.60