Question

The values of Stock A and Stock B on a particular day are Rs. 50 and Rs. 80,
respectively. An investor invests Rs. 100 in Stock A and Rs. 80 in Stock B. He
sells all the stocks the next day when the value of Stock A is Rs. 55 and Stock B
is Rs. 70. The profit made by the investor is Rs. ________

• A. 0
• B. 5
• C. 10
• D. 20

Hint:

Calculate the number of shares bought in each stock using investment divided by price, then compare next-day value to initial investment for each stock separately.

Answer 1

The Correct Option is A

Step 1: Find how many shares of each stock the investor buys. Stock A costs Rs. 50 per share, and Rs. 100 is invested, so the number of Stock A shares is \(100/50 = 2\).
Step 2: Stock B costs Rs. 80 per share, and Rs. 80 is invested, so the number of Stock B shares is \(80/80 = 1\).
Step 3: The next day, Stock A is worth Rs. 55 per share, so the value of the 2 shares of Stock A becomes \(2 \times 55 = 110\). The profit from Stock A is \(110 - 100 = 10\).
Step 4: The next day, Stock B is worth Rs. 70 per share, so the value of the 1 share of Stock B becomes \(1 \times 70 = 70\). The loss from Stock B is \(70 - 80 = -10\).
Step 5: Total profit is the sum of the results from both stocks: \(10 + (-10) = 0\).
Final Answer: \[\text{Total Profit} = \boxed{Rs. 0}\] which is option (A).