A man buys a horse for $60. He sells it for $70. He then buys the horse back for $80. And he sells the horse for $90. In the end, how much money did the man make or lose? Or did he break even?
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Step 1: buys a horse for $60. The man is -$60 of cash from his starting point.
Step 2: sells the horse for $70. The man gets $70, so he is a net -$60 + $70 = $10 of cash.
Step 3: buys the horse for $80. The man spends $80, which means he is a net of $10 – $80 = -$70 cash.
Step 4: sells the horse for $90. The man gets $90, which means he is a net of -$70 + $90 = $20 cash.
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