Let's analyze the information step-by-step to determine the best day to sell the stocks.
1. Initial Purchase Details:
- Metropolis (MTP): 30 shares at [tex]$17.95 per share
- Suburbia (SBR): 55 shares at $[/tex]5.63 per share
2. Closing Prices:
- Metropolis (MTP):
- Day 1: [tex]$17.95
- Day 2: $[/tex]18.28
- Day 3: [tex]$18.25
- Suburbia (SBR):
- Day 1: $[/tex]5.63
- Day 2: [tex]$5.88
- Day 3: $[/tex]4.98
3. Total Value on Day 1:
- Metropolis: [tex]\(30 \text{ shares} \times \$17.95 = \$538.50\)[/tex]
- Suburbia: [tex]\(55 \text{ shares} \times \$5.63 = \$309.65\)[/tex]
- Total Value Day 1: [tex]\(\$538.50 + \$309.65 = \$848.15\)[/tex]
4. Total Value on Day 2:
- Metropolis: [tex]\(30 \text{ shares} \times \$18.28 = \$548.40\)[/tex]
- Suburbia: [tex]\(55 \text{ shares} \times \$5.88 = \$323.40\)[/tex]
- Total Value Day 2: [tex]\(\$548.40 + \$323.40 = \$871.80\)[/tex]
5. Total Value on Day 3:
- Metropolis: [tex]\(30 \text{ shares} \times \$18.25 = \$547.50\)[/tex]
- Suburbia: [tex]\(55 \text{ shares} \times \$4.98 = \$273.90\)[/tex]
- Total Value Day 3: [tex]\(\$547.50 + \$273.90 = \$821.40\)[/tex]
6. Profit Calculation:
- Profit on Day 2: [tex]\(\$871.80 - \$848.15 = \$23.65\)[/tex]
- Profit on Day 3: [tex]\(\$821.40 - \$848.15 = -\$26.75\)[/tex] which is a loss.
Conclusion:
Comparing the values, we see:
- The value on Day 2 is higher than on Day 3.
- The profit on Day 2 is positive and greater.
Therefore, the best day to sell both stocks is:
Day 2 is the best by $23.65.
