An investor purchased 50 shares of stock in a company in 2015. At the time the investor purchased the stock, the value of the stock was priced at $5 per share. The investor sold all 50 shares of stock in 2019. The value of the stock at the time of sale was $6.50 per share. What is the capital gain the investor earned on this investment? (1 point)
$75
$325
$250
$50
The capital gain on the investment can be calculated using the formula:
Capital Gain = (Selling Price - Purchase Price) * Number of Shares
We are given that the investor purchased 50 shares of stock at $5 per share and sold them at $6.50 per share.
Purchase Price = $5 per share
Selling Price = $6.50 per share
Number of Shares = 50
Plugging these values into the formula:
Capital Gain = ($6.50 - $5) * 50
Capital Gain = ($1.50) * 50
Capital Gain = $75
Therefore, the capital gain the investor earned on this investment is $75.