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19 January, 21:31

Greg purchased stock in Bear Stearns and Co. at a price of $88 per share one year ago. The

company was acquired by JP Morgan at a price of $11 per share. What is Gregʹs return on his

investment?

A) - 87.50%

B) - 113.75%

C) - 100.62%

D) - 96.25%

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Answers (1)
  1. 19 January, 23:06
    0
    A) - 87.50%

    Explanation:

    The computation of the return on the investment is shown below:

    = (Acquired price by JB Morgon - purchase price per share) : (purchase price per share)

    = ($11 per share - $88 per share) : (88 per share)

    = - ($77 per share) : (88 per share)

    = - 87.50%

    We simply take the difference of the price and then divide it with the purchase price per share so that the correct percentage can come.
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