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Portfolio

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by srisl11 » Wed Nov 19, 2008 1:41 pm
A certain portfolio consisted of 5 stocks, priced at $20, $35, $40, $45 and $70, respectively. On a given day, the price of one stock increased by 15%, while the price of another decreased by 35% and the prices of the remaining three remained constant. If the average price of a stock in the portfolio rose by approximately 2%, which of the following could be the prices of the shares that remained constant?

A) 20, 35, 70

B) 20, 45, 70

C) 20, 35, 40

D) 35, 40, 70

E) 35, 40, 45

OA E
I saw this question in the previous posts but the explanation was not clear .
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Source: — Problem Solving |

by vishubn » Wed Nov 19, 2008 5:16 pm
GIVEN :
(20+35+40+45+70)/5=42
now 42 is the average

210 and increase in 2 percent is 214.2/5

so increase in 4.2 units is wat is needed

so decresed should be lowest share and increase to be highest !

without even calcualting ! :)
OA E

Vishu
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by 4meonly » Sun Nov 23, 2008 7:35 am
vishubn wrote:GIVEN :
(20+35+40+45+70)/5=42
now 42 is the average

210 and increase in 2 percent is 214.2/5

so increase in 4.2 units is wat is needed

so decresed should be lowest share and increase to be highest !

without even calcualting ! :)
OA E

Vishu
20 - 15% = 17 (we have -3)
70+35% = 94,5 (we have +24,5)
finally we have gain +21,5 in the sum of stock value
But 2% increase in avergare yields 214,2 (+14,2) in stock value.

21,5 do not equal to 14,2

What do you think?
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