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At current prices, if the owner of 150,000 Studt Systems shares collected the dividend then sold the shares, how many Tombe shares could they buy with the proceeds (to the nearest 10,000)?

        A.  290,000

        B.  280,000

        C.  270,000

        D.  260,000

        E.  250,000

Answer: E

Explanation:

Step 1 – Calculate the Company Share value including the dividend 150,000 x (3.00 + 0.08) = £462,000 Step 2 – Calculate the number of Tombe shares 462,000/1.85 = 249,730 So the correct answer is 250,000

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Which share has changed in price by the largest amount since the previous day?

        A.  Relf plc

        B.  Studt Systems

        C.  Xan Inc

        D.  IWE Ltd

        E.  Cannot Say

Answer: D

Explanation:

Step 1 – Calculate the Previous Day’s Price for each share listed as an answer option. Previous Day’s Price = Previous Day’s Company Value / Total number of Company Shares. Relf plc= 240 / 80 = £3.00 Studt Systems = 171 / 55 = £3.11 Xan Inc. = 28 / 12 = £2.33 IWE Ltd = 200 / 114 = £1.75 Step 2 – Calculate the difference with the Current price for each share, as follows; Relf plc = 3.00 - 2.75 = 0.25 Studt Systems = 3.11 – 3.00 = 0.11 Xan Inc. = 2.33 - 2.28 = 0.05 IWE Ltd = 1.75 - 1.48 = 0.27 So the correct answer is IWE Ltd

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A day trader bought 50,000 Tombe shares at last month’s low, received the Tombe dividend and then sold all these shares at last month’s high. What was the approximate percentage gain or loss?

        A.  25.3%profit

        B.  19.4%profit

        C.  25.3% loss

        D.  20.5%loss

        E.  20.5% profit

Answer: C

Explanation:

Step 1 – Calculate the cost to buy the shares 50,000 x £1.70 = £85,000 Step 2 – Calculate the profit from the change in share price £2.03 x 50,000 = £101,500 £101,500 - £85,000 = £16,500 Step 3 – add the dividend £16,500 + (0.10 x 50,000) = £21,500 Step 4 – calculate the % 21,500/85,000 = 25.3% Tip: notice that one of the multiple choice options is the answer if you forgot to add the dividend (19.4% profit). This is called a distractor. So the correct answer is 25.3% profit

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Which regional store sold the second highest number of new mobile phone contracts for the Platinum and Gold packages combined (over the previous 12 months)?

        A.  Central

        B.  Northern

        C.  Southern

        D.  Eastern

        E.  Western

Answer: B

Explanation:

Calculate the combined Platinum and Gold packages for each of IK-Connections Ltd’s regional stores: Platinum package Gold package Total 4,540 4,854 9,394 4,725 5,005 9,730 4,584 5,123 9,707 4,884 5,256 10,140 So the correct answer is Northern

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What is the difference in revenue between the package with the lowest number of sales and the package with the highest number of sales over the 12 month period, across all regions combined?

        A.  £151,740

        B.  £101,750

        C.  £15,400

        D.  £5,747

        E.  Cannot Say

Answer: A

Explanation:

Step 1 – find the highest selling and the lowest selling number of new mobile phone contracts by totaling sales across all 5 regional stores for each package Platinum Gold package Silver package Bronze package package Central 4,540 4,854 5,083 5,425 Northern 4,725 5,005 5,382 5,846 Southern 4,584 5,123 5,759 5,428 Western 4,682 4,759 4,956 4,869 Eastern 4,884 5,256 4,982 4,592 TOTAL 23,415 24,997 26,162 26,160 Step 2 – calculate the difference in sale values between the Silver and Platinum packages Silver package = 26,162 x £30 = £784,860 Platinum package = 23,415 x £40 = £936,600 Difference = £936,600 - £784,860 = £151,740 So the correct answer is £151,740


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