Can someone help me with my finance homework?

Question

I've read my book, gone over my notes, looked at sample problems, but I can't seem to catch on. My first question is :

Two years ago, you purchased a stock for $36. The annual rates of return during the subsequent two years are 29% and -60%. What is today's stock price.

I don't want you to just give me the answer, that is kind of cheating, I just want to understand how to do the problem, what formula do I use and so on. I would appreciate any help.

Thanks.

Answer 1

Take the original ammount (36)
multiply it by the percent of change plus one (1.29)
You get (46.44) for the first year
multiply by the second rate of change subtracted from one (.4)
You get (18.58)
this is the answer.
You add the first one to (1) because it is an increase and you subtract the second one from (1) because it is a decrease.

Answer 2

36 dollars with a rate of return at 29% for the first year.
36x1.29= 46.44
46.44 dollars with a rate of return at -60%
46.44x.60=27.86 is your loss so 46.44-27.86= 18.58 is you new value.

Since the first year the value appreicaited you multiply it at 100% plus the percentage of the rate of return to get the new value.
Since it depreciated the second year you have to figure out your loss then subtract it from the value at the beginning of the year.

Answer 3

go to yahoo finance and you can look at from the year you bought it at.