Question
P5-22) An investor pays $101 to buy a share of zenotrop stock. simultaneously a different investor sells one share of zenotrop and received $100 in
P5-22) An investor pays $101 to buy a share of zenotrop stock. simultaneously a different investor sells one share of zenotrop and received $100 in cash. at the moment that these trades took place. what were the bid and ask prices of zenotrop stock? A. Bid price = $101; ask price = $100. B. Bid price = $100; ask price = $101.
P6-11) the nominal return on a particular investment is 11% and inflation rate is 1%, what is the nominal rate of return on the bond? What is the real return? A. 8% B. 8.82% C. 9% D. 13%
P6-12) A bond offers a real return of 5%. If investors expect 3% inflation, what is the nominal rate of return on the bond? A. 8% B. 8.15% C. 8.50% D. 9%
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