this post was submitted on 14 May 2025
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Flippanarchy

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It's praxis ok? (lemmy.dbzer0.com)
submitted 1 week ago by [email protected] to c/[email protected]
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[–] [email protected] 1 points 1 week ago* (last edited 1 week ago)

“If the stock market yesterday morning was at 11000 points and falls 30% by close yesterday. only to rise by 30% today. Will the wealthy class claim that it closed at the same level before yesterday morning or acknowledge they skimmed the top while playing it off as it bounced completely back?”

It would also be a good lesson to teach them about how percentages are multiplicative rather than additive, and can be used like statistics to trick you.

For example, a 1100 base and having the market drop by 30% then rise by 30% would leave the market down by about 9% (1100 * .7 * 1.3 = 1001). You would actually need a 43% rise after the 30% fall to bounce completely back. (1100 *.7 * 1.43 = 1101.1)