Stefan Places a Good-'Til-Canceled Limit Order to Sell 200 Shares

question 108

Multiple Choice

Stefan places a good-'til-canceled limit order to sell 200 shares of MRK at $76 a share. When his order reaches the trading floor, MRK is trading at $76.48. Which of the following statements is true concerning Roy's order?

• A) The trade will not be executed and will be immediately cancelled.
• B) The order will only be executed if it can be matched with an order to buy at $76.
• C) The broker will sell the 200 shares at $76.48 and keep the additional $0.48 as a commission.
• D) The order will be executed at $76.48 with the proceeds credited to Stefan's account.

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Definitions:

Spendthrift Clause

A provision in a trust that prevents beneficiaries from pledging or assigning their interest in the trust's assets to creditors, offering protection from creditors' claims.

Beneficiary Protection

Legal measures or provisions that ensure the rights and interests of beneficiaries, particularly in insurance and estate matters, are safeguarded.

Creditors

Individuals, organizations, or entities that are owed money by debtors, having provided goods, services, or loaned money.

Child Support

A legal obligation or financial support paid by a parent for the benefit of their child following a divorce or separation.