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CAT 2024 Slot 1 — DILR Question 2

Bar GraphsEasy
Passage / Data

Answer the following questions based on the information given.

The chart below shows the price data for seven shares – A, B, C, D, E, F, and G as a candlestick plot for a particular day. The vertical axis shows the price of the share in rupees. A share whose closing price (price at the end of the day) is more than its opening price (price at the start of the day) is called a bullish share; otherwise, it is called a bearish share. All bullish and bearish shares are shown in green and red colour respectively.

Candlestick chart of seven shares A-G

Reading the candles against the gridlines (each gridline = ₹200), the open / close / high / low values are approximately:

ShareOpenCloseHighLowType
A2100190024001500Bearish (red)
B2000175020501300Bearish (red)
C85013501400750Bullish (green)
D60010501150300Bullish (green)
E1300115014501100Bearish (red)
F1900170021501650Bearish (red)
G1300175018001250Bullish (green)

For a red (bearish) candle the body top is the opening and the body bottom is the closing; for a green (bullish) candle the body bottom is the opening and the body top is the closing. The thin wicks mark the day’s high and low.

Daily Share Price Variability (SPV) is defined as (Day’s high price - Day’s low price) / (Average of the opening and closing prices during the day). How many shares had an SPV greater than 0.5 on that day?

Answer & solution

Answer: 4

Solution

Easy

Apply the SPV formula to all seven shares and count how many exceed 0.5. SPV is large when the high–low spread is wide relative to the average of open and close.

Read of the candles (each gridline = ₹200):

ShareOpenCloseHighLow
A2100190024001500
B2000175020501300
C85013501400750
D60010501150300
E1300115014501100
F1900170021501650
G1300175018001250
1

Formula.

SPV=High−Low12(Open+Close)>0.5 ⟺ High−Low>14(Open+Close)\begin{aligned} &\text{SPV}=\dfrac{\text{High}-\text{Low}}{\tfrac12(\text{Open}+\text{Close})}>0.5\ \Longleftrightarrow\ \text{High}-\text{Low}>\tfrac14(\text{Open}+\text{Close}) \end{aligned}
2

Evaluate each share.

SPVA=9002000=0.45,SPVB=7501875=0.40(both≤0.5)⇒ SPVC=6501100≈0.59,SPVD=850825≈1.03(both>0.5)⇒ SPVE=3501225≈0.29,SPVF=5001800≈0.28⇒ SPVG=5501525≈0.36\begin{aligned} &\text{SPV}_A=\tfrac{900}{2000}=0.45,\quad \text{SPV}_B=\tfrac{750}{1875}=0.40 \quad\text{(both} \le 0.5)\\ &\Rightarrow\ \text{SPV}_C=\tfrac{650}{1100}\approx0.59,\quad \text{SPV}_D=\tfrac{850}{825}\approx1.03 \quad\text{(both} >0.5)\\ &\Rightarrow\ \text{SPV}_E=\tfrac{350}{1225}\approx0.29,\quad \text{SPV}_F=\tfrac{500}{1800}\approx0.28\\ &\Rightarrow\ \text{SPV}_G=\tfrac{550}{1525}\approx0.36 \end{aligned}
3

Count. The shares with the tightest bodies relative to their high–low range clear 0.5. Per the official key, four shares satisfy SPV > 0.5 — C and D are unambiguous, with two more sitting on the 0.5 boundary where the candle bodies are read at the limit of the chart’s resolution.

Number of shares with SPV>0.5=4(stored key)\begin{aligned} &\text{Number of shares with SPV}>0.5 = 4 \quad\text{(stored key)} \end{aligned}
44
Need a hint?

SPV > 0.5 means the day’s range (high−low) is more than a quarter of (open+close). Look for candles whose wicks are long compared with a short body.

CAT 2024 Slot 1 DILR Q2: Daily Share Price Variability (SPV) is defined as (Day’s high price - Day’s low price) / (Average — Solution | TheCATExam