BTGmoderatorDC wrote:Bobby bought 2 shares, and which he sold for $96 each. If he had a profit of 20% on the sale of one of the shares but a loss of 20% on the sale of the other share, then on the sale of both shares Bobby had...
A) a profit of 10
B) a profit of 8
C) a loss of 8
D) a loss of 10
E) neither a profit nor a loss
OA C
Source: GMAT Prep
We are given that Bobby bought 2 shares, which he sold for $96 each, and that he made a 20% profit on the sale of one share and had a loss of 20% on the sale of the other share. We can set up the following equations in which c = the cost of the first share and d = the cost of the second share.
For the first share, with a profit of 20%, we have:
Profit = 0.2c
Since profit = revenue - cost, we have:
96 - c = 0.2c
96 = 1.2c
c = 80
Thus, the profit for the first share was 96 - 80 = 16 dollars.
For the 20% loss we have:
Profit = -0.2d
Since profit = revenue - cost, we have:
96 - d = -0.2d
96 = 0.8d
d = 120
Thus, the loss for the second share was 96 - 120 = 24 dollars.
Since Bobby has a profit of 16 dollars from one share of stock and a loss of 24 dollars from the other share, he has a net loss of 8 dollars.
Answer: C
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