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Jon invested $10000 in a certain stock exactly three years ago. The

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Jon invested $10000 in a certain stock exactly three years ago. The [#permalink]

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New post 10 May 2017, 02:31
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Jon invested $10000 in a certain stock exactly three years ago. The value of the stocks decreased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the stocks today?

A. $8500
B. $8505
C. $9500
D. $10,395
E. $10,500

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Re: Jon invested $10000 in a certain stock exactly three years ago. The [#permalink]

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New post 10 May 2017, 02:43
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Initial Stock Value: $10000
During 1st year, decrement of 10% hence, Value of stock= 0.9*10000 i.e. $9000
During 2nd year, increment of 5% hence, value of stock = 1.05*9000 i.e $9450
During 3rd year, decrement of 10% hence, Value of stock= 0.9*9450 i.e. $8505
Hence, Option B is the correct answer.
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Jon invested $10000 in a certain stock exactly three years ago. The [#permalink]

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New post 10 May 2017, 06:01
Bunuel wrote:
Jon invested $10000 in a certain stock exactly three years ago. The value of the stocks decreased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the stocks today?

A. $8500
B. $8505
C. $9500
D. $10,395
E. $10,500


In successive percent increases and/or decreases, another very fast way is to "multiply the multipliers" (see links below), then multiply that product by the original amount.

1st change is 10% decrease, hence 1 - .10 = .90

2nd change is 5% increase, hence 1 + .05 = 1.05

3rd change is another 10% decrease = .90

(.9)(1.05)(.9) = .8505

.8505 x $10,000 = $8,505

https://magoosh.com/gmat/2012/understanding-percents-on-the-gmat/

https://gmatclub.com/forum/excellent-method-for-calculating-successive-percentages-185973.html
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Re: Jon invested $10000 in a certain stock exactly three years ago. The [#permalink]

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New post 12 May 2017, 13:37
Bunuel wrote:
Jon invested $10000 in a certain stock exactly three years ago. The value of the stocks decreased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the stocks today?

A. $8500
B. $8505
C. $9500
D. $10,395
E. $10,500


We are given that a 10,000 dollar stock decreased by 10 percent, increased by 5 percent and then decreased by 10%. Thus, the new price is:

10,000 x (9/10) x (105/100) x (9/10) = 9 x 105 x 9 = $8505

Answer: B
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Re: Jon invested $10000 in a certain stock exactly three years ago. The [#permalink]

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New post 16 May 2017, 05:56
Jon invested $10000 in a certain stock exactly three years ago. The value of the stocks decreased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the stocks today?

A. $8500
B. $8505
C. $9500
D. $10,395
E. $10,500

Principal stock amount = 10000
After first year stock decreased by 10% = 90% of 10000
After second year stock increased by 5% = 105% of 90% of 10000
After third year stock decreased by 10% = 90% of 105% of 90% of 10000
Value of stocks today = \(\frac{90}{100}\) x \(\frac{105}{100}\) x \(\frac{90}{100}\) x 10000 = $8505
Answer B....

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Re: Jon invested $10000 in a certain stock exactly three years ago. The [#permalink]

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New post 16 May 2017, 08:02
Bunuel wrote:
Jon invested $10000 in a certain stock exactly three years ago. The value of the stocks decreased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the stocks today?

A. $8500
B. $8505
C. $9500
D. $10,395
E. $10,500


Let the original value be $100

Value after 1st year = \(\frac{90}{100*100}\) \(= 90\)

Value after 2nd year = \(\frac{105}{100*90}\) \(= 94.50\)

Value after 3rd year = \(\frac{90}{100*94.50}\) \(= 85.05\)

Thus, the value of the stock will be (B) $8505
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Re: Jon invested $10000 in a certain stock exactly three years ago. The   [#permalink] 16 May 2017, 08:02
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