1. The current market for Papi's Electronics equity shares is below. It displays bid, ask prices and quote depth (shares).

Given this information, what would happen if you placed a market sell order for 400 shares ?

BID (SHARES) | ASK (SHARES)

$48 (300) | $48.50 (2,000)

$47.5 (250) | $49.00 (300)

1. Your trade would not be executed and your order becomes the new best Ask price at $48 for 400 shares.
2. You would sell 300 shares at $48; and then sell 100 shares at $47.50
3. You would sell 400 shares at $48
4. You would sell 400 shares at $48.50

2. Firm A has a debt/equity ratio of 3.2x and their income statement shows that 80% of their costs are fixed costs.

Firm B has a debt/equity ratio of 1.1x and their income statement shows that 14% of their costs are fixed costs.

Given this information and your newly found knowledge of investments, please state which firm's stock should perform BETTER on a relative basis in a DECLINING economic environment. Assume all else is equal between the two firms (industry, valuation metrics, etc...)

A. Firm A should outperform Firm B

B. Firm B should outperform Firm A

C. Firm A and Firm B should not have a material difference in returns since they are in the same industry and have similar valuation metrics.