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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]

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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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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

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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.
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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

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06 Jul 2008, 22:01
goalsnr wrote:

This question is more like a general knowledge question than a GMAT DS question

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16 Jul 2008, 10:11
friends, can someone please conform if either C or E is correct?

cheers

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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.
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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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16 Jul 2008, 15:05
GMBAB5......good catch.

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

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