Math Problem Statement

An investor has an account with stock from two different companies. Last year, her stock in Company A was worth $2600 and her stock in Company B was worth $3450. The stock in Company A has increased 19% since last year and the stock in Company B has increased 22%. What was the total percentage increase in the investor’s stock account? Round your answer to the nearest tenth (if necessary).

Solution

The question from the image asks about calculating the total percentage increase in the value of an investor’s stock portfolio, given two stocks with different initial values and different percentage increases. Here's how to solve it:

Given:

  • Stock in Company A was worth $2600 and increased by 19%.
  • Stock in Company B was worth $3450 and increased by 22%.

Step 1: Calculate the new value of each stock.

For Company A:

  • Increase = 2600×19100=4942600 \times \frac{19}{100} = 494
  • New value of Company A stock = 2600+494=30942600 + 494 = 3094

For Company B:

  • Increase = 3450×22100=7593450 \times \frac{22}{100} = 759
  • New value of Company B stock = 3450+759=42093450 + 759 = 4209

Step 2: Calculate the total portfolio value before and after the increases.

  • Total value last year = 2600+3450=60502600 + 3450 = 6050
  • Total value this year = 3094+4209=73033094 + 4209 = 7303

Step 3: Calculate the total percentage increase in the portfolio.

Percentage increase=New TotalOld TotalOld Total×100\text{Percentage increase} = \frac{\text{New Total} - \text{Old Total}}{\text{Old Total}} \times 100 =730360506050×100=12536050×10020.71%= \frac{7303 - 6050}{6050} \times 100 = \frac{1253}{6050} \times 100 \approx 20.71\%

So, the total percentage increase in the investor’s stock account is approximately 20.7%.

Would you like a further breakdown of any part of this solution? Here are some related questions:

  1. How would the solution change if the percentages of stock increases were different?
  2. What if one stock had decreased in value instead of increasing?
  3. How do you calculate the new total portfolio value after a certain percentage change?
  4. What formula can you use for percentage increase in other financial situations?
  5. How can you express the overall portfolio increase in dollar terms instead of percentages?

Tip:

Always double-check your percentage calculations, especially when dealing with investments, as small errors can lead to significantly different financial results.

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Math Problem Analysis

Mathematical Concepts

Percent Increase
Algebra
Stock Valuation

Formulas

New Value = Old Value + (Old Value * Percentage Increase / 100)
Total Percentage Increase = ((New Total - Old Total) / Old Total) * 100

Theorems

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Suitable Grade Level

Grades 7-10