Use the table for the question(s) below.

-On June 5th 2009,a share of Lululemon stock on Toronto Stock Exchange (TSX)was quoted as Bid: $15.58 and Ask: $15.84.If a competitive price is $15.71,
A) the transaction cost to buy or sell is $0.13.
B) the transaction cost to buy or sell is $0.26.
C) the transaction cost to buy or sell is zero.
D) none of the above

Question

Use the table for the question(s) below.
 
-On June 5th 2009,a share of Lululemon stock on Toronto Stock Exchange (TSX)was quoted as Bid: $15.58 and Ask: $15.84.If a competitive price is $15.71,
A) the transaction cost to buy or sell is $0.13. 
B) the transaction cost to buy or sell is $0.26. 
C) the transaction cost to buy or sell is zero. 
D) none of the above

Quizplus · Accepted Answer

The transaction cost is the difference between the competitive price and the bid or ask price. Here, it is $15.71 - $15.58 = $0.13.

Use the Table for the Question(s) Below