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Real-Life Activities

Real-Life Math -- Solution

What is the price of electricity?

The price of electricity on the market has gone up by 9 percent, then 10 percent.

9 percent
Price = $60 x 1.09
Price = $65.40

10 percent
Price = $65.40 x 1.10
Price = $71.94

The price is more than high enough for you to sell! If you're not careful to sell while it's high, you may not make your money.

"Trading strategies are more complex than the math to calculate the profit of buying low and selling high," says Lucia Tomson, an energy trader. "The market rules are detailed to the level that complex algorithms are used to determine the dispatch of generation, load, imports and exports. These algorithms must be understood since they affect the ultimate price for the electricity commodity and if you win or lose on the trade."