Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Consider the following limit order book for a share of stock. The last trade in the stock occurred at a price of $110. Limit Buy

image text in transcribedimage text in transcribed

Consider the following limit order book for a share of stock. The last trade in the stock occurred at a price of $110. Limit Buy Orders Price Shares $109.75 600 109.70 900 109.65 600 109.60 200 108.65 700 Limit Sell Orders Price Shares $109.80 200 109.85 200 109.90 400 200 109.95 a. If a market buy order for 200 shares comes in, at what price will it be filled? (Round your answer to 2 decimal places.) Best price b. At what price would the next market buy order be filled? (Round your answer to 2 decimal places.) Next best price c. If you were a security dealer, would you want to increase or decrease your inventory of this stock? Increase Decrease

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals Of Futures And Options Markets

Authors: John C. Hull

7th Edition

0136103227, 9780136103226

More Books

Students also viewed these Finance questions

Question

an inverted yield curve indicates that debt securities

Answered: 1 week ago