I have a story problem in my finance class. I can't figure out how to determine if my math is correct or not. The problem is:
You purchase stock for 0.015 (one and a half cent) per share. You purchased 7,500 shares. Several decades later you sell the stock for $1.00 per share. How much money do you have?
I keep coming up with $746,250.00 and $7,462,500.00. I'm not sure which, if either is correct. It seems like there should be a formula for this kind of thing. However, I can't seem to find it. Am I going about this correctly?
THank you!
Cost of purchase = Price per share $\times$ Number of shares $= \$0.015 \times 7500 = \$112.5$
Earning from selling = Price per share $\times$ Number of shares $= \$1 \times 7500 = \$7500.$
Net profit $= \$7500 - \$112.5 = \$7487.5$