Stuart wants to buy some additional stock in Admiral Engines, but the price of the stock has been fluctuating wildly in recent days. He wants to make sure he doesn't pay too much. His analysis suggests that $26 per share is the highest price he should pay. What is Stuart likely to place with his broker?

Question

Quizplus · Accepted Answer

A limit order allows Stuart to specify a maximum price at which he is willing to buy the stock. This means that if the price of the stock goes above his specified limit of $26 per share, the broker will not execute the trade, thus ensuring that Stuart does not pay too much for the stock.

Stuart Wants to Buy Some Additional Stock in Admiral Engines