Total implied and actual transaction cost


Problem:

You find that the bid and ask prices for a stock are $11.75 and $12.50, respectively. If you purchase or sell the stock, you must pay a flat commission of $15. If you buy 200 shares of the stock and immediately sell them,

Required:

what is your total implied and actual transaction cost in dollars?

  • $15
  • $30
  • $180
  • $165

Note: Please provide reasons to support your answer.

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Finance Basics: Total implied and actual transaction cost
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