A financial analyst notices that the same stock is trading for different prices on two different exchanges. The stock is trading for $100 on Exchange A and $102 on Exchange B. The analyst believes that there is an opportunity for arbitrage and wants to take advantage of it. The analyst has $10,000 available to invest and can trade without incurring any transaction costs. How many shares of the stock can the analyst buy on Exchange A and sell on Exchange B in order to make a risk-free profit?

Answer rating: 100% (QA)

To determine how many shares the analyst can buy on Exchange A and sell on Exchange B to make a risk... View the full answer