Consider the following limit order book for FinTrade stock. The last trade in the stock occurred at a price of $135. Limit Buy Orders Limit Sell Orders Price Shares Price Shares $134.75 600 $ 134.80 200 134.70 900 134.85 200 134.65 600 134.90 400 134.60 200 134.95 200 133.65 700 Required: a. If a market buy order for 200 shares comes in, at what price will it be filled? (Round your answer to 2 decimal places.) Best price b. At what price would the following market buy order be filled? (Round your answer to 2 decimal places.) Next best price c. If you were a security dealer, would you want to increase or decrease your inventory of this stock? Increase Decrease
Consider the following limit order book for FinTrade stock. The last trade in the stock occurred at a price of $135. Limit Buy Orders Limit Sell Orders Price Shares Price Shares $134.75 600 $ 134.80 200 134.70 900 134.85 200 134.65 600 134.90 400 134.60 200 134.95 200 133.65 700 Required: a. If a market buy order for 200 shares comes in, at what price will it be filled? (Round your answer to 2 decimal places.) Best price b. At what price would the following market buy order be filled? (Round your answer to 2 decimal places.) Next best price c. If you were a security dealer, would you want to increase or decrease your inventory of this stock? Increase Decrease
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Consider the following limit order book for FinTrade stock. The last trade in the stock occurred at a price of $135.
Limit Buy Orders
Limit Sell Orders
Price
Shares
Price
Shares
$134.75
600
$ 134.80
200
134.70
900
134.85
200
134.65
600
134.90
400
134.60
200
134.95
200
133.65
700
Required:
a. If a market buy order for 200 shares comes in, at what price will it be filled? (Round your answer to 2 decimal places.)
Best price
b. At what price would the following market buy order be filled? (Round your answer to 2 decimal places.)
Next best price
c. If you were a security dealer, would you want to increase or decrease your inventory of this stock?
Increase
Decrease
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