Donna Warne purchased a share of company X at $700 one year ago. The share is now trading at $850. Calculate the percent capital gain if Donna sells her share at the current price.
A) 17.6%
B) 150%
C) 6.7%
D) 21.4%

Question

Quizplus · Accepted Answer

The capital gain is calculated as the difference between the current price and the purchase price, divided by the purchase price, multiplied by 100%.

Capital gain = [(current price - purchase price) / purchase price] x 100%
Capital gain = [(850 - 700) / 700] x 100%
Capital gain = (150 / 700) x 100%
Capital gain = 0.214 x 100%
Capital gain = 21.4%

Therefore, the percent capital gain if Donna sells her share at the current price is 21.4%, which corresponds to choice D.

Donna Warne Purchased a Share of Company X at $700