1. Entry Task
Twice a number increased by 10 equals 52, and 115 less than 3 times the number also equals 52
Write two quations that represent this situation
Solve your equations
2x + 10 = 52 and 115 – 3x = 52
2x + 10 = 115 – 3x
5x = 105
X = 21

2. 1-7 STOCK TRANSACTION FEES
Banking
5/7/2018
1-7 STOCK TRANSACTION FEES
OBJECTIVES
Compute the fees involved in buying and selling stocks.
Become familiar with the basic vocabulary of stock trading.
Chapter 1

3. Key Terms stockbroker broker fee commission discount broker
Banking
5/7/2018
Key Terms
stockbroker
broker fee
commission
discount broker
at the market
limit order
net proceeds
Chapter 1

4. How do you buy and sell stock?
Banking
5/7/2018
How do you buy and sell stock?
How has the Internet changed the way stock is traded?
Chapter 1

5. Banking
5/7/2018
Example 1
Lee made two trades through his online discount broker, We-Trade. We-Trade charges a fee of $12 per trade. Lee’s first purchase was for $3,456 and his second purchase, later in the day, was for $2,000. How much did he spend on the day’s purchases, including broker fees?
2 trade at $12 each is $24
= 5456
= $5480
Chapter 1

6. CHECK YOUR UNDERSTANDING
Banking
5/7/2018
CHECK YOUR UNDERSTANDING
Garret made two trades in one day with his discount broker that charges $7 per trade. Garret’s first purchase was for $1,790 and his second purchase was for $8,456. How much did he spend including broker fees?
$10,260
Chapter 1

7. Banking
5/7/2018
Example 2
Adriana purchased $7,000 worth of stock from a broker at Tenser Brokerage. The current value of Adriana’s portfolio is $11,567. What broker fee must she pay?
.005* = $50
Chapter 1

8. CHECK YOUR UNDERSTANDING
Banking
5/7/2018
CHECK YOUR UNDERSTANDING
Jared has a portfolio worth $500,000. He made 10 telephone trades during the past year, buying and selling $50,000 worth of stock. What was his total broker fee for the year? Express his total broker fee algebraically if Jared had made b automated telephone trades.
12b + 9.5b = 21.5b
12* *10 =$215
Chapter 1

9. Banking
5/7/2018
EXAMPLE 3
Erin purchased $23,510 worth of stock and paid her broker a 1% broker fee. She sold when the stock price increased to $27,300, and used a discount broker who charged $21 per trade. Compute her net proceeds.
23510 * .01 = $235.10
$ $21 = $ in total fees
27,300 – 23,510 = $3790 is what she made
3790 – = $ net earnings
Chapter 1

10. CHECK YOUR UNDERSTANDING
Banking
5/7/2018
CHECK YOUR UNDERSTANDING
Yolanda purchased stock for $7,000 and paid a 1.5% broker fee. She sold it for $6,325 and paid a 0.5% broker fee. Compute her net proceeds.
-$811.63
Chapter 1

11. Banking
5/7/2018
EXAMPLE 4
Johan purchased stock six years ago for x dollars and paid a 2% broker fee. He sold that stock yesterday for y dollars and paid a discount broker $35 for the sale. Express his net proceeds algebraically.
Purchase cost = cost of stock + broker fee
= x + .02x
Sale proceeds = sale price of stock – broker fee
= y-35
Net proceeds = sale proceeds – purchase cost
= (y-35) – (x+.02x)
Simplify
= y x
Chapter 1

12. Assignment
P. 43 #2-7, 9,10, 12,13

13. CHECK YOUR UNDERSTANDING
Banking
5/7/2018
CHECK YOUR UNDERSTANDING
Rob purchased stock for p dollars and paid a flat $40 broker fee. Rob needed money for a home improvement so he sold it at a loss, for h dollars, plus a 1% broker fee. Express his net proceeds algebraically.
(h-.01h) – (p+40) Or
.99h – p - 40
Chapter 1