Last Year the price per share of Company As stock on March 31 was 25 percent higher than its price per share on March

BTGmoderatorDC wrote: ↑

Wed Jul 01, 2020 8:28 pm

Last Year the price per share of Company A's stock on March 31 was 25 percent higher than its price per share on March 1. By April 30 the stock's price per share was 20 percent lower than the price per share on March 1. What was the percent decrease in price per share of the stock from March 31 to April 30?

A. 5%
B. 25%
C. 36%
D. 45%
E. 56%


OA C

Source: GMAT Prep

Say the stock price on March 1 was $100; thus, the stock price on March 31 = $125; and the stock Prince on April 30 = $80

The required percent decrease in stock price = [(125 – 80)/125]*100% = 36%

Correct answer: C

Hope this helps!

-Jay
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BTGmoderatorDC wrote: ↑

Wed Jul 01, 2020 8:28 pm

Last Year the price per share of Company A's stock on March 31 was 25 percent higher than its price per share on March 1. By April 30 the stock's price per share was 20 percent lower than the price per share on March 1. What was the percent decrease in price per share of the stock from March 31 to April 30?

A. 5%
B. 25%
C. 36%
D. 45%
E. 56%


OA C

Solution:

We are given that last year the price per share of Company A's stock on March 31 was 25 percent higher than its price per share on March 1, and that by April 30 the stock's price per share was 20 percent lower than the price per share on March 1.

If we let p = the price per share of Company A’s stock on March 1, we can create the following equations:

price on March 31st = 1.25p
price on April 30th = 0.8p

We need to determine the percent decrease in price per share of the stock from March 31st to April 30th. We can use the percent change equation:

Percent change = (new - old) / old x 100

Percent decrease = [(0.8p - 1.25p) / (1.25p)] x 100

Percent decrease = [(80p - 125p) / (125p)] x 100

Percent decrease = [(-45p) / (125p)] x 100

Percent decrease = (-9/25) x 100 = -9 x 4 = -36

Thus, there was a 36 percent decrease in price per share.

Answer: C