25) You own 20000 shares in Boohoo plc. Currently they trade at 99p for bid and 100p for offer, which typically reflect the average spread conditions. However, the spread has a standard deviation of 1p. Under normal market conditions, the cost of liquidation should be closer to: (reminder - critical level for a one-sided 95% tail of a standard normal distribution is 1.65) a) £10 b) £16.50 c) £83.50 d) £100

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
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25) You own 20000 shares in Boohoo plc. Currently they trade at 99p for bid and
100p for offer, which typically reflect the average spread conditions. However, the
spread has a standard deviation of 1p. Under normal market conditions, the cost of
liquidation should be closer to: (reminder - critical level for a one-sided 95% tail of a
standard normal distribution is 1.65)
a) £10
b) £16.50
c) £83.50
d) £100
Transcribed Image Text:25) You own 20000 shares in Boohoo plc. Currently they trade at 99p for bid and 100p for offer, which typically reflect the average spread conditions. However, the spread has a standard deviation of 1p. Under normal market conditions, the cost of liquidation should be closer to: (reminder - critical level for a one-sided 95% tail of a standard normal distribution is 1.65) a) £10 b) £16.50 c) £83.50 d) £100
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