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Suppose that BAC trades in a specialist (a type of market maker) market. Below is the order book for Bank of America (BAC) stock. Buy

  1. Suppose that BAC trades in a specialist (a type of market maker) market. Below is the order book for Bank of America (BAC) stock. 

Buy Side

Sell Side

Bid price

Shares

Asked Price

Shares

34.03

2,000

34.18

2,500

34.01

1,500

34.25

1,000

33.98

2,500

34.50

2,000

  1. Suppose you have submitted an order to your broker to buy 3,000 shares at market. At what price will your trade be executed?
  2. Suppose you have submitted an order to sell 1,500 shares at market. At what price will your trade be executed?
  3. Suppose you have submitted a limit order to sell 2,500 shares at $34.02. What will happen?
  4. Suppose you have submitted a limit order to buy 1,000 shares at $34.17. What will happen?

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