Problem 2. You open a 1000 share short position in Happy Bunny Inc. common stock at the bid-ask price spread of $32.00 - $32.50. When you close your position the bid-ask prices are $30.25 - $30.50. Happy Bunny Inc. common stock paid a cash dividend in the amoount of $0.20 per share while you held the short position. If you pay a commission of $10 per trade, and interest rates are zero, calculate your profit or loss on the investment position?
Problem 2. You open a 1000 share short position in Happy Bunny Inc. common stock at the bid-ask price spread of $32.00 - $32.50. When you close your position the bid-ask prices are $30.25 - $30.50. Happy Bunny Inc. common stock paid a cash dividend in the amoount of $0.20 per share while you held the short position. If you pay a commission of $10 per trade, and interest rates are zero, calculate your profit or loss on the investment position?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![Problem 2. You open a 1000 share short position in Happy Bunny Inc. common
stock at the bid-ask price spread of $32.00 - $32.50. When you close your position
the bid-ask prices are $30.25 – $30.50. Happy Bunny Inc. common stock paid a cash
dividend in the amoount of $0.20 per share while you held the short position. If you
pay a commission of $10 per trade, and interest rates are zero, calculate your profit
or loss on the investment position?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F01d01b29-ede7-42ba-8dcd-8c0b18e94cc8%2Fea84f0f7-b185-4a12-8f1e-65b69623d5d1%2Fj8d9e7_processed.png&w=3840&q=75)
Transcribed Image Text:Problem 2. You open a 1000 share short position in Happy Bunny Inc. common
stock at the bid-ask price spread of $32.00 - $32.50. When you close your position
the bid-ask prices are $30.25 – $30.50. Happy Bunny Inc. common stock paid a cash
dividend in the amoount of $0.20 per share while you held the short position. If you
pay a commission of $10 per trade, and interest rates are zero, calculate your profit
or loss on the investment position?
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