Sally Has Researched GLE and Wants to Pay No More

question 22

Multiple Choice

Sally has researched GLE and wants to pay no more than $50 for the stock. Currently, GLE is trading in the market for $54. Sally would be best served to:

• A)buy using a limit order.
• B)buy using a market order.
• C)use the bid-ask spread to her advantage.
• D)None of these.

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Definitions:

Sealed-bid Auctions

Auctions in which all bidders simultaneously submit their bids in sealed envelopes, with no bidder knowing the bid of the others.

Common-value Auction

An auction format where the item for sale has the same value for everyone, but bidders have different information about that value.

Oral Auctions

Public sales where goods or services are sold to the highest bidder through verbal bids.

Withhold Information

The act of intentionally not sharing information that may be relevant or required by others for decision-making or other purposes.