Question
2. The bid price of a Treasury bill is ________. a. the price at which the dealer in Treasury bills is willing to sell the
2. The bid price of a Treasury bill is ________.
a. the price at which the dealer in Treasury bills is willing to sell the bill
b. the price at which the dealer in Treasury bills is willing to buy the bill
c. greater than the ask price of the Treasury bill expressed in dollar terms
d. the price at which the investor can buy the Treasury bill
3. Harold shorts Barnes Inc. at $84. A month later the company pays a $3 dividend. At what stock price will Harold make a 10% gain from his position?
a. $72.60
b. $75.60
c. $89.40
d. $92.40
4. An investor puts up $10,000 but borrows an equal amount of money from his broker to double the amount invested to $20,000. The broker charges 4% on the loan. The stock was originally purchased at $25 per share, and in 1 year the investor sells the stock for $27. The investor's rate of return was ____.
a. 6.00%
b. 10.00%
c. 12.00%
d. 4.00%
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