sayan640
Bunuel , Can you please help me understand why you write the highlighted portion in that way ? Sorry for troubling you ...Thank you in advance..
Bunuel
Bunuel

The graph above shows the distribution of assets in an international investment portfolio on a certain day. The investor wants to make a total of x dollars available for investment in a new asset by decreasing each of the five existing asset categories by p percent. Which of the following expresses p in terms ofx?
A. \(x(10^{-5})\)
B. \(x(10^{-4})\)
C. \(x(10^{-3})\)
D. \(x(10^{-2})\)
E. \(x(10^{-1})\)
Currently, the value of the portfolio is $100,000.
If $x should be withdrawn from the current portfolio for the new investments, then the portfolio, and each investment, should be decreased by \(\frac{x}{100,000}*100% = \frac{x}{1,000}% = x(10^{-3})%\).Answer: C.
Alternatively, we can assume x = $1,000. Since the value of the portfolio is $100,000, each asset should be decreased by 1%. By substituting x = $1,000, we can see that only option C results in a 1% decrease.
When you withdraw p percent from each investment, the overall portfolio decreases by the same percentage, p. For instance, let's consider a simpler scenario where a portfolio is valued at $100,000, comprising two investments: one worth $20,000 and another worth $80,000. If we withdraw 10% from each investment, that equates to $2,000 from the first and $8,000 from the second, resulting in a total withdrawal of $10,000. Thus, 10% is withdrawn from the entire portfolio value of $100,000.
Attachment:
GMAT-Club-Forum-zwr8n9tu.png [ 163.23 KiB | Viewed 7125 times ]