Previous Year Paper
CAT2006Previous Years Paper
Two traders, Chetan and Michael, were involved in the buying and selling of MCS shares over five trading days. At the beginning of the first day, the MCS share was priced at Rs 100, while at the end of the fifth day it was priced at Rs 110. At the end of each day, the MCS share price either went up by Rs 10, or else, it came down by Rs 10. Both Chetan and Michael took buying and selling decisions at the end of each trading day.
The beginning price of MCS share on a given day was the same as the ending price of the previous day.
Chetan and Michael started with the same number of shares and amount of cash, and had enough of both.
Below are some additional facts about how Chetan and Michael traded over the five trading days.
· Each day if the price went up, Chetan sold 10 shares of MCS at the closing price. On the other hand, each day if the price went down, he bought 10 shares at the closing price.
· If on any day, the closing price was above Rs 110, then Michael sold 10 shares of MCS, while if it was below Rs 90, he bought 10 shares, all at the closing price.
If Chetan sold 10 shares of MCS on three consecutive days, while Michael sold 10 shares only once during the five days, what was the price of MCS at the end of day 3?
A  Rs 90

B  Rs 100

C  Rs 110

D  Rs 120

On the 1st day, the price was Rs 100 per share. Now we can have the following cases:
Cases 
1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
Cases 
1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
At the end of 1st day 
90 
110 
90 
110 
110 
90 
110 
110 
90 
110 
At the end of 2nd day 
100 
100 
80 
120 
100 
100 
120 
120 
100 
120 
At the end of 3rd day 
90 
90 
90 
110 
110 
110 
130 
110 
110 
110 
At the end of 4th day 
100 
100 
100 
100 
100 
100 
120 
120 
120 
120 
At the end of 5th day 
110 
110 
110 
110 
110 
110 
110 
110 
110 
110 
Ans. C Obviously from case1, at the end of 3rd day, price of share is Rs 110.
Hence, option C. is the answer.
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