Explanation:
Proportional Bid-ask spread =
= \frac{(\`54.10 - \53.70`)}{[(\`54.10 + \53.70`) \times 0.5]}
= $0.00740.74`%$
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Q.3214 Tim Lauren is an analyst at a large commercial bank. He plans to invest in Grantson Automobile stock with bid and ask prices equal to $53.70 and $54.10, respectively. Given this information, the proportional bid-ask spread for Grantson Automobile stock is closest to?
A
0.74%.
B
1.48%.
C
2.35%.
D
1.45%.
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