Question: Please solve for questions 1,2,3 and 4. Please show your work. Please explain your reasoning. A hedge fund wants to purchase 100 shares of company

Please solve for questions 1,2,3 and 4.

Please show your work.

Please explain your reasoning.

A hedge fund wants to purchase 100 shares of company X. The bid = $70, offer = $80. They also want to purchase 200 shares of company Y. The bid = $15. offer = $25. 1) What is the proportional bid-offer spread of each company? 2) What is the midmarket total value of each position? 3) What is the cost to the hedge fund to unwind the portfolio? 4) If the bid-offer spreads are normally distributed with mean $10 and standard deviation $3. what is the 99% worst-case cost of unwinding the position in the future

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