Evaluate the gain or loss to the lender

Assignment Help Finance Basics

Reference no: EM1344108

Assume that an investor lends 100 shares of Jiffy, Inc. common stock to a short seller. The bidask prices are $32.00 - $32.50. When the position is closed the bid-ask prices are $32.50 - $33.00.

The commission rate is 0.5%. The market interest rate is 5.0% and the short rebate rate is 3.0%. Evaluate the gain or loss to the lender. Assume the lender is not subject to a bid-ask loss or
commissions.

A. $164.00 loss
B. $100.00 gain
C. $100.00 loss
D. $164.00 gain

Reference no: EM1344108

Questions Cloud

Show the functions of the federal reserve board : Show the major functions of the Federal Reserve Board and recognize the role of the FED as the commercial bank of the US Treasury

Find the future value of bond : Kate Greenway company, having recently issued a $20,113,000, 15 year bond issue, is committed to make yearly sinking fund deposits of $610,000.

Drawing decision table for type of treatment of customer : Draw a decision table to represent the type of treatment to be given to a customer of the EyeTunes Music Club.

How is this going to involve prices in the marketplace : How is this going to involve prices in the marketplace for New York City. Create sure to provide appropriate economic terms in your answers.

Evaluate the gain or loss to the lender : The commission rate is 0.5%. The market interest rate is 5.0% and the short rebate rate is 3.0%. Evaluate the gain or loss to the lender.

How much would the economy funds provide increase : Assume which all other banks hold only the required amount of reserves. If Nan Bank Inc. decides to reduce its reserves to only the required amount, by how much would the economy's funds provide increase.

Evaluate the value of the objective function over : Evaluate the value of the objective function over the five-year period for each of the three policies and which policy is best? Why?

Consolidation criterion led : When is consolidation considered inappropriate even though the parent holds a majority of the voting common shares of another firm?

Who in the us government is responsible for computing : Who in the U.S. government is responsible for computing also reporting the consumer price index.

User Account

All Pages