Suppose That the ETF Is Trading for $362

question 20

Multiple Choice

Suppose that the ETF is trading for $362.36;you should:

• A)sell the EFT and buy 2 shares of IBM,3 shares of MRK,and 3 shares of C.
• B)sell the EFT and buy 3 shares of IBM,2 shares of MRK,and 3 shares of C.
• C)buy the EFT and sell 2 shares of IBM,3 shares of MRK,and 3 shares of C.
• D)do nothing,no arbitrage opportunity exists.

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Definitions:

Positron Emission Tomography

A nuclear medicine functional imaging technique used to observe metabolic processes in the body as an aid to the diagnosis of disease.

Functional Magnetic Resonance Imaging

A neuroimaging technique that measures and maps brain activity based on changes in blood flow.

Brain Activity

The functionality of the brain as it engages in various cognitive, sensory, emotional, and motor tasks, often measured by neuroimaging techniques.

Cerebellum

A region of the brain that plays an important role in motor control, coordination, precision, and timing.