Question

You invest $5,175.00 in a stock plan. It increases 9% the first year and then losses 5% of its value the second year. What is your gain compared to you original investment?

Answer 1

Answer:  $183.71

Step-by-step explanation:

Original amount is $5,175.00

1st year: Increase of 9%

→  $5175(1 + 0.09)

=   $5175(1.09)

=  $5640.75

                                       2nd year: Decrease of 5%  

                                       → $5640.75(1 - 0.05)

                                       =  $5640.75(0.95)

                                       = $5358.71

                                                                              Gain: 2nd year - Original  

                                                                               → $5358.71 - $5175.00

                                                                               = $183.71

Answer 2

Answer:

$183.7

Step-by-step explanation:

We know that $5,175.00 was invested in a stock plan.

It increased by 9% in the first year:

$9% \times 5175.00 = 465.75$

So value reached to (5175 + 465.75 = ) $5640.75

Then it second year, it lost 5% of its value:

$95% \times 5640.75 = 5358.7$

Therefore, the gain compared to the initial original investment will be:

$5358.7 - $5175.0 = $183.7