A stockbroker placed the following order for a customer: -50 shares of Kaiser Aluminum preferred at $104 a share
-100 shares of GTE preferred at $25 1/4 a share
-20 shares of Boston Edison preferred at $9 1/8 a share
What is the weighted arithmetic mean price per share?
A) $25.25
B) $79.75
C) $103.50
D) $46.51
E) Weighted mean cannot be computed for this data set.

Question

Quizplus · Accepted Answer

The weighted arithmetic mean price per share is calculated by finding the total cost of the shares and dividing by the total number of shares. For Kaiser Aluminum: 50 shares * $104 = $5200. For GTE: 100 shares * $25.25 (since 1/4 of a dollar is $0.25) = $2525. For Boston Edison: 20 shares * $9.125 (since 1/8 of a dollar is $0.125) = $182.5. The total cost is $5200 + $2525 + $182.5 = $7907.5. The total number of shares is 50 + 100 + 20 = 170. The weighted mean = $7907.5 / 170 = $46.51.

A Stockbroker Placed the Following Order for a Customer: -50