How much is transaction cost per dollar of stock controlled

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Suppose that the value of the S&P 500 stock index is 1,600.

a. If each futures contract costs $25 to trade with a discount broker, how much is the transaction cost per dollar of stock controlled by the futures contract? (Round your answer to 4 decimal places. Omit the "%" sign in your response.)

 Transaction cost per dollar %

b. If the average price of a share on the NYSE is about $40, how much is the transaction cost per “typical share” controlled by one futures contract? (Round your answer to 5 decimal places. Omit the "$" sign in your response.)

 Transaction cost per share $   

c. For small investors, a typical transaction cost per share in stocks directly is about 10 cents per share. How many times the transactions costs in futures markets is this? (Round your answer to 2 decimal places.)

 Number of times   times

Reference no: EM131927992

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