An investor purchased 50 shares of stock in a company in 2015. At the time the investor purchased the stock, the value of the stock was priced at $5

Question

per share. The investor sold all 50 shares of stock in 2019. The value of the stock at the time of sale was $6.50
per share. What is the capital gain the investor earned on this investment?(1 point)
Responses

$50
50 dollars

$250
250 dollars

$325
325 dollars

$75

Answer 1

To calculate the capital gain, you need to determine the difference between the sale price and the purchase price, and then multiply that by the number of shares.

1. Purchase Price per Share: $5
2. Sale Price per Share: $6.50
3. Number of Shares: 50

Capital Gain per Share: \[ \text{Capital Gain per Share} = \text{Sale Price} - \text{Purchase Price} = 6.50 - 5.00 = 1.50 \]

Total Capital Gain: \[ \text{Total Capital Gain} = \text{Capital Gain per Share} \times \text{Number of Shares} = 1.50 \times 50 = 75 \]

The capital gain the investor earned on this investment is $75.