Question: Please use excel to solve. The problem and the data provided must be clearly laid out in the spreadsheet and cell referencing must be used.

Please use excel to solve. The problem and the data provided

Please use excel to solve. The problem and the data provided must be clearly laid out in the spreadsheet and cell referencing must be used.

6. Ms. Tejal Gandhi has decided that the stock of SmallCap Inc. is overvalued at $4 a share and wants to sell it short. Since the price is relatively low, short sales cannot be executed on margin, so Ms. Gandhi must put up the entire value of the stock when it is sold short. a) What is the percentage loss if the price of the stock rises to $8? b) What is the percentage loss if the price of the stock rises to $10? c) What is the percentage gain if the company goes bankrupt and is dissolved? d) What are the maximum percentage gain the short seller can earn and the largest percentage loss the short seller can sustain? e) From the short seller's perspective, what are the best- and worst-case scenarios? 6. Ms. Tejal Gandhi has decided that the stock of SmallCap Inc. is overvalued at $4 a share and wants to sell it short. Since the price is relatively low, short sales cannot be executed on margin, so Ms. Gandhi must put up the entire value of the stock when it is sold short. a) What is the percentage loss if the price of the stock rises to $8? b) What is the percentage loss if the price of the stock rises to $10? c) What is the percentage gain if the company goes bankrupt and is dissolved? d) What are the maximum percentage gain the short seller can earn and the largest percentage loss the short seller can sustain? e) From the short seller's perspective, what are the best- and worst-case scenarios

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