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The share price of AMCO has risen consistently for 20 years

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The share price of AMCO has risen consistently for 20 years [#permalink] New post 06 Nov 2008, 10:40
Question # 31, your answer = E
The share price of AMCO has risen consistently for 20 years. What was it worth in December 1998?
(1) In December 1994, the stock was valued at $49.
(2) During the bull market from 1994 to 1999, the stock increased in value by 10% each year.

i marked e.
pls advice
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Re: d.s. [#permalink] New post 07 Nov 2008, 00:17
question stem suggests that the rate of rise has been consistent, which means we can assume a linear change.

(1) gives us the value in Dec 94..but we don't know the rate of rise year-over-year, to compute the price in Dec 98. So cross out A and D

(2) says value has risen 10% YOY from 94 to 99. But we don't know the begin price, so can't compute the value in Dec 98. So cross out B

Now (1) and (2) together provides a begin value (Dec 94 -$49), and a rate of rise of 10%(which is consistent). So with the 2 statements together you can compute the price during Dec 98. So my pick would be C. is that the OA?

Also, reading the question stem critically... I'd say the question will be one of the incorrect choices in the Sentence Correction section. The pronoun reference, IT is misleading...Does it refer to the 'share price' or does it refer to 'amco''s total worth :-D
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Re: d.s.   [#permalink] 07 Nov 2008, 00:17
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The share price of AMCO has risen consistently for 20 years

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