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# A person buys a share for $50 and sells it for$ 52 after a

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A person buys a share for $50 and sells it for$ 52 after a [#permalink]  05 Jul 2008, 00:18
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8. A person buys a share for $50 and sells it for$ 52 after a year. What is the total profit made by him from the share?
(I) A company pays annual dividend
(II) The rate of dividend is 25%
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Re: DS [#permalink]  05 Jul 2008, 03:38
saurabhkowley18 wrote:
8. A person buys a share for $50 and sells it for$ 52 after a year. What is the total profit made by him from the share?
(I) A company pays annual dividend
(II) The rate of dividend is 25%

total profit = profit from selling share + dividend
profit from selling share = $2 I) insuff since we don't know dividend II) insuff since we don't know the frequency of dividends I&II => suff, we have both profit from shares & dividend & dividend frequency Answer should be C Manager Joined: 03 Jun 2008 Posts: 136 Schools: ISB, Tuck, Michigan (Ross), Darden, MBS Followers: 2 Kudos [?]: 17 [0], given: 0 Re: DS [#permalink] 05 Jul 2008, 11:10 saurabhkowley18 wrote: 8. A person buys a share for$ 50 and sells it for $52 after a year. What is the total profit made by him from the share? (I) A company pays annual dividend (II) The rate of dividend is 25% The answer is E. The face value is not given for us to calculate the dividend. _________________ ----------------------------------------------------------- 'It's not the ride, it's the rider' VP Joined: 03 Apr 2007 Posts: 1366 Followers: 3 Kudos [?]: 353 [0], given: 10 Re: DS [#permalink] 06 Jul 2008, 19:03 saurabhkowley18 wrote: 8. A person buys a share for$ 50 and sells it for $52 after a year. What is the total profit made by him from the share? (I) A company pays annual dividend (II) The rate of dividend is 25% This question is more like a general knowledge question than a GMAT DS question Director Joined: 14 Aug 2007 Posts: 733 Followers: 8 Kudos [?]: 140 [0], given: 0 Re: DS [#permalink] 06 Jul 2008, 22:01 goalsnr wrote: This question is more like a general knowledge question than a GMAT DS question Manager Joined: 14 Jun 2007 Posts: 170 Location: Vienna, Austria Followers: 1 Kudos [?]: 5 [0], given: 0 Re: DS [#permalink] 16 Jul 2008, 10:11 friends, can someone please conform if either C or E is correct? cheers SVP Joined: 30 Apr 2008 Posts: 1888 Location: Oklahoma City Schools: Hard Knocks Followers: 38 Kudos [?]: 496 [0], given: 32 Re: DS [#permalink] 16 Jul 2008, 10:17 It has to be E because in order for us to know 25% of what, we have to know the date the dividend was declared and the value as of the date the company declares as the dividend date. Stock might be$52 now, but if the dividend date is figured as of 2 weeks ago when the stock was $49.50. _________________ ------------------------------------ J Allen Morris **I'm pretty sure I'm right, but then again, I'm just a guy with his head up his a$$. GMAT Club Premium Membership - big benefits and savings Manager Joined: 11 Apr 2008 Posts: 128 Location: Chicago Followers: 1 Kudos [?]: 42 [0], given: 0 Re: DS [#permalink] 16 Jul 2008, 11:18 jasonc wrote: saurabhkowley18 wrote: 8. A person buys a share for$ 50 and sells it for $52 after a year. What is the total profit made by him from the share? (I) A company pays annual dividend (II) The rate of dividend is 25% total profit = profit from selling share + dividend profit from selling share =$2

I) insuff since we don't know dividend
II) insuff since we don't know the frequency of dividends

I&II => suff, we have both profit from shares & dividend & dividend frequency

E.

You don't know the base for which the dividend was applied (stocls do not have face values), you don't know the inflation rate (this will eat away at your profit), you don't know the commission charge, exchange fee, etc. --- Definitely a general knowledge question, not a GMAT question.
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Re: DS [#permalink]  16 Jul 2008, 15:05
GMBAB5......good catch.

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Re: DS [#permalink]  17 Apr 2010, 10:56
IMO E.

You also don't know whether the person sold the share before/after dividend declared.
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Re: DS   [#permalink] 17 Apr 2010, 10:56
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