Question

Jessie bought 500 shares of Ford on January 1st and enrolled in the DRIPS program. Ford paid a dividend of $1.00 per share at the end of that year.  Assuming Jessie holds the stock for two additional years, how many shares will Jessie own at the end of the third year if Ford stock trades at an average price of 6.00?

A) 794

B) 800

C) 945

D) 700

My understanding of the question: Aware that Jessie owned 500 shares and received $1.00 per share leaving Jessie with $500 cash to be re-invested.

Joe bought 500 shares of Ford at 10.00 per share on 5/1/2019. Six months later, on November 7th, the stock was trading at 7.00 per share. Joe likes the future of Ford so he buys another 300 shares at 7.00. Recently, Ford stock was trading around 5.00 per share. Joe decides to buy an additional 200 shares at $5.00 per share to round off her share ownership at 1000 shares total. What is Joe's average cost on Ford?

A) $6.80 Per Share

B) $7.50 Per Share

C) $10.00 Per Share

D) $8.10 Per Share

My understanding of the question: I took $10.00 + $7.00 + $5.00 = 22 / 3 = 7.33 for the average. that's not a choice, so I' am curious what my mistake is

Answer 1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

JUST WRITTEN IN EXCEL, NO EXCEL FUNCTION IS USED