Q:

Nicole bought 500 shares of a company stock for $8.24/share. she pays a broker a commission of $20 buy and sell sock. after one year, she sold all her shares, which were worth it $10.10/share at the time. what was her rate of return

Accepted Solution

A:
She had a rate of return of 21.5%.

Her total cost to buy the shares was:
500 x 8.24 + 20 = 4140

When she sold the stocks, she made:
500 x 10.10 - 20 =5030

The difference of those two amounts is $890.

Converting it to a percent gives:

890 / 4140 x 100 = 21.5%