Re: The price of Company A's stock fell by 20\% two weeks ago and by anoth
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08 Oct 2025, 09:46
Let's work through the problem step-by-step:
Suppose the original share price is $P$.
1. First drop (20%): After the first week, the price becomes $\(P \times 0.8\)$.
2. Second drop (25%): After the second week, the new price is $\(P \times 0.8 \times 0.75=P \times 0.6\)$.
So, the current price is $0.6 P$.
To return to the original price $P$, the increase needed is $\(P-0.6 P=0.4 P\)$.
What percent of the current price is this increase?
Percent increase $\(=\frac{0.4 P}{0.6 P} \times 100=\frac{2}{3} \times 100=66 \frac{2}{3}\) %$
So, the share price must rise by $\(66 \frac{2}{3}\) %$ of its current value to return to the original price.
If you want, we can walk through similar compound percent questions together or try some practice rounds.