Last Year the price per share of...

BTGmoderatorLU wrote: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%

The OA is C.

I am getting a wrong answer every time I try. Can any expert help me with this PS question please? Thanks.

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

BTGmoderatorLU wrote: ↑

Thu Oct 19, 2017 6:56 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%

The OA is C.

I am getting a wrong answer every time I try. Can any expert help me with this PS question please? Thanks.

Since the goal is to find a certain PERCENT (as opposed to finding a certain value), we can assign a nice value to the share price on March 1st
Let's say $100 = the share price on March 1st

The price per share of Company A's stock on March 31 was 25 percent higher than its price per share on March 1
So, the price per share on March 31 = $100 + 25% of $100 = $125

By April 30 the stock's price per share was 20 percent lower than the price per share on March 1
So, the price per share on April 30 = $100 - 20% of $100 = $80

What was the percent decrease in price per share of the stock from March 31 to April 30?
So, we want to find the percent decrease when we go from $125 to $80

Percent decrease = (100)(difference in values)/original value
= (100)(125 - 80)/125
= (100)(45)/125
= (100)(9)/25
= (4)(9)
= 36%

Answer: C