Multiple Choice
On Commodity Exchange A it is possible to buy and sell crude oil at $117 per barrel,while on Commodity Exchange B crude oil can be bought and sold at $118 per barrel.If there are transaction costs of 1% when buying or selling on either exchange,what is the net effect of buying a barrel of oil on Exchange A and selling it on Exchange B?
A) -$1.35
B) -$0.17
C) $0.99
D) $1.01
Correct Answer:
Verified
Correct Answer:
Verified
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