Question

The value of Bulls Eye stock has decreased 8% each year for the past several years. If in 2010 the stock was worth

Answer 1

Answer:

$ 32.95

Step-by-step explanation:

Cost of Stock at 2010= $ 50

Declining rate each year= 8%

We have to find cost of stock at 2015

Cost of stock after 5 years= $ 50 $(1-\frac{8}{100} )^{5}$

Value of stock after 5 years=  $ 50 $(\frac{100-8}{100} )^{5}$

Value of stock after 5 years=  $ 50 $(\frac{92}{100} )^{5}$

Value of stock after 5 years=  $ 32.95

Hence, the correct answer is $ 32.95