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Which of the following statement is correct? None of the above Price Impact is not a...

Which of the following statement is correct?

None of the above

Price Impact is not a trading cost for investors when trading common stocks

When buying on margin, if margin is less than Initial Margin Requirement, a margin call will occur

Commission is a trading cost for investors when trading common stocks

Purchases of new issues of stock take place in the money markets

Solutions

Expert Solution

Ans) Commission is a trading cost for investors when trading common stock

Option 1 is false as price impact is a trading cost for investor when trading common stock

Option 2 is false as margin call is required when margin goes below maintenance margin

Option 4 is false as purchase of new issues of stock takes place in primary market

jeff jeffy answered 2 years ago
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