Use the Information for the Question(s)below

question 34

Essay

Use the information for the question(s)below.
An exchange traded fund (ETF)is a security that represents a portfolio of individual stocks.Consider an ETF for which each share represents a portfolio of two shares of International Business Machines (IBM),three shares of Merck (MRK),and three shares of Citigroup Inc.(C).Suppose the current market price of each individual stock are shown below:
-Assume that the ETF is trading for $670.00,what (if any)arbitrage opportunity exists? What (if any)trades would you make?

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Definitions:

Alphabet Letters

The basic written symbols in an alphabetic system that represent the phonemes of a spoken language.

Climacteric

A phase in the aging process marking the transition from the reproductive phase to the non-reproductive years in both men and women, often associated with menopause in women.

Menstrual Periods

The monthly shedding of the uterine lining in females of reproductive age, marked by bleeding through the vagina.

Hot Flashes

Sudden feelings of warmth, often over the face, neck, and chest, that can occur during menopause.