Find all School-related info fast with the new School-Specific MBA Forum

It is currently 29 Aug 2014, 06:24

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

If $4500 dollars was invested in a bond fund when the price

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
Manager
Manager
avatar
Joined: 08 Sep 2006
Posts: 53
Followers: 0

Kudos [?]: 2 [0], given: 0

If $4500 dollars was invested in a bond fund when the price [#permalink] New post 23 Jul 2007, 17:40
If $4500 dollars was invested in a bond fund when the price per share was $9 and $3000 was invested when the price was $10, What is the average price per share?

a) 9.40
b) 9.375
c) 9.50
d) 9.75
e) 10.0

Please explain how you arrive at the answer.
Senior Manager
Senior Manager
User avatar
Joined: 28 Jun 2007
Posts: 463
Followers: 2

Kudos [?]: 5 [0], given: 0

GMAT Tests User
 [#permalink] New post 23 Jul 2007, 17:42
(4500 + 3000)/(500 + 300) = 75/8

9.375

500 is the number of shares bought when its $9
300 is the number of shares bought when its $10

total cost/total shares = avg. cost per share
GMAT Club Legend
GMAT Club Legend
User avatar
Joined: 07 Jul 2004
Posts: 5097
Location: Singapore
Followers: 17

Kudos [?]: 136 [0], given: 0

GMAT Tests User
 [#permalink] New post 23 Jul 2007, 17:44
# of shares issued with 4500 invested at pps of 9 = 4500/9 = 500
# of shares issued with 3000 invested at pps of 10 = 3000/10 = 300

TOtal number of shares = 800
Total amount invested = 7500

Average PPS = 7500/800 = 75/8 = 9.375
Manager
Manager
avatar
Joined: 08 Sep 2006
Posts: 53
Followers: 0

Kudos [?]: 2 [0], given: 0

 [#permalink] New post 23 Jul 2007, 17:49
Thanks for the quick reply
Senior Manager
Senior Manager
User avatar
Joined: 17 Jul 2007
Posts: 288
Location: The 408
Followers: 3

Kudos [?]: 2 [0], given: 0

GMAT Tests User
 [#permalink] New post 23 Jul 2007, 19:11
B. $9.375

Total price of all shares bought ($7500)

Divided by number of shares purchased at each price ( 500+ 300 = 800)

$7500/800 = $9.375
Intern
Intern
User avatar
Joined: 08 Sep 2006
Posts: 34
Followers: 0

Kudos [?]: 0 [0], given: 0

GMAT Tests User
Re: Avg Price? [#permalink] New post 24 Jul 2007, 07:30
tinman1412 wrote:
If $4500 dollars was invested in a bond fund when the price per share was $9 and $3000 was invested when the price was $10, What is the average price per share?

a) 9.40
b) 9.375
c) 9.50
d) 9.75
e) 10.0

Please explain how you arrive at the answer.


I would add that with a simple glance you can get rid of 3 of the answers immediately.

Note that if the same number of shares were purchased at each price point, the average would be $9.5/share. Since more shares were purchased at $9 than $10 ($4500 vs $3000 ~ 500 to 300), we know the average is closer to 9 than 10. Therefore we can cross out c, d, and e. This is a good way to check your answer if you are prone (like me) to dumb errors.
Re: Avg Price?   [#permalink] 24 Jul 2007, 07:30
    Similar topics Author Replies Last post
Similar
Topics:
Sustainable/SRI Investment Funds bschoolq2 0 12 May 2012, 17:18
1 Experts publish their posts in the topic Samantha invests i1 dollars in bond X, which pays r1 nandini11 19 02 Oct 2010, 10:56
Pat invested x dollars in a fund that paid 8 % annual TheBigCheese 1 12 Jul 2008, 07:52
Pat invested x dollars in a fund that paid 8 percent annual M8 2 09 May 2006, 00:15
An investor purchased a bond for p dollars on Monday. For a GMATT73 1 18 Dec 2005, 01:33
Display posts from previous: Sort by

If $4500 dollars was invested in a bond fund when the price

  Question banks Downloads My Bookmarks Reviews Important topics  


GMAT Club MBA Forum Home| About| Privacy Policy| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group and phpBB SEO

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.