COMPULSORY QUESTION

The following is a sample of a stock exchange trade sheet

Company / stocks	Volume	Close price $	Change $	Closing Bid $	Closing Ask $
ADF	290,000	11.30	0.00	11.30	11.31
CRT	5,000	37.50	0.00	36.50	47.10
RED	55,000	32.50	-4.10	32.00	33.00
OQS	240,000	6.51	-0.32	6.50	6.52
UHG	30,000	9.38	-0.13	9.30	9.50
EAD	110,000	3.36	0.07	3.35	3.38
QIN	6,000	6.80	0.00	6.00	89.00
ZQI	10,000	4.57	0.04	4.50	4.65
FUG	11,000	6.80	0.00	6.50	7.20
HFR	35,000	8.80	0.00	8.70	9.95

You have been contemplating buying stocks on the stock market and have received the following offers from a broker.

A. Shares of CRT stock at $50.00 per share

B. Shares of ADF stock at $9.50

i. Analyze the feasibility of investment in either of the stocks at the present time (4 marks)

ii. Indicate the TWO (2) most liquid stocks from the table above (2 marks)

iii. From the table above name ONE (1) stock that

a. Advanced

b. Traded firm (2 marks)

C. Assess the effect of the following on the performance of the stock market:

i. Inflation

ii. Interest rate

iii. World events (12 marks)