You Find That the Bid and Ask Prices for a Share

question 32

Multiple Choice

You find that the bid and ask prices for a share are $10.25 and $10.30 respectively. If you purchase or sell the share you must pay a flat commission of $25. If you buy 100 shares of the share and immediately sell them, what is your total implied and actual transaction cost in dollars?

• A)$50
• B)$25
• C)$30
• D)$55

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Definitions:

Chronological Age

The actual age of a person or object, measured in years from the date of birth or creation.

Monozygotic Twins

Twins who originate from a single fertilized egg, making them genetically identical.

Fertilized Egg

A cell formed by the union of a male gamete (sperm) and a female gamete (egg), marking the beginning of embryonic development.

Embryos

Early stages of development in multicellular organisms after fertilization and before becoming fetuses.