Question

a company’s stock began the day at $30.75 per share. that price drops by $1.08 each hour.
a. what is the price per share after 4 hours?
b. what will it be after 31 hours if this rate continues?
c. explain what the signs of the answers mean in this context.
...
c. the price per share after 4 hours is $26.43.
d. the price per share after 4 hours is -$2.73.
b. what will it be after 31 hours if this rate continues?
a. the price per share after 31 hours will be $26.43.
b. the price per share after 31 hours will be $26.93.
c. the price per share after 31 hours will be -$2.23.
d. the price per share after 31 hours will be -$2.73.

Explanation:

Part a

Step1: Determine total drop in 4 hours

The price drops by \$1.08 each hour. For 4 hours, total drop is \(1.08\times4\).
\(1.08\times4 = 4.32\)

Step2: Subtract total drop from initial price

Initial price is \$30.75. So price after 4 hours is \(30.75 - 4.32\).
\(30.75 - 4.32 = 26.43\)

Part b

Step1: Calculate total drop in 31 hours

Drop per hour is \$1.08, so for 31 hours, total drop is \(1.08\times31\).
\(1.08\times31 = 33.48\)

Step2: Subtract total drop from initial price

Initial price is \$30.75. So price after 31 hours is \(30.75 - 33.48\).
\(30.75 - 33.48 = - 2.23\)

Part c

• For part a's positive answer: The stock price is still above zero, so it has a real - world meaning of the stock having a positive monetary value per share after 4 hours of decline.
• For part b's negative answer: Mathematically, it is the result of the total decrease in price over 31 hours being greater than the initial price. In a real - world stock market context, a negative stock price doesn't make sense as a stock's price can't be negative (you can't have a negative value for an ownership share), but it shows the extent of the price decline over time.

Answer:

\$26.43