Question

Joyce's mother buys some shares of Company A on Day 0.

Answer 1

Answer:

(i) 4000

(ii) $5.00

Step-by-step explanation:

Let no. of shares of Company A be X

Let share price of Company B on Day 7 be $y

Share price of Company B on Day 12 = $(y-0.50)

(i)

Consider Day 7:

4.60x - 2000y = 7400................ (1)

Consider Day 12:

4.80x - 5000(y-0.50) = -5800

4.80x - 5000y + 2500 = -5800

4.80x - 5000y = -8300............... (2)

(1)*2.5:

11.5x - 5000y = 18500................. (3)

(3)-(2):

11.5x - 4.80x - 5000y + 5000y = 18500 + 8300

6.70x = 26800

x = 4000

(ii)

Sub. x = 4000 into (1):

4.60(4000) - 2000y = 7400

-2000y = 7400 - 18400

-2000y = -11000

y = 5.5

Share price of Company B on Day 12

= 5.50 - 0.50

= $5.00