Final answer:
A buy stop order at 39 would be activated and could fill at prices 40 or 41, which are at or above the specified stop price. It would not fill at price 38 or 39, as the order stipulates a price of 39 or higher for activation.
Step-by-step explanation:
A buy stop order at 39 could fill at the following prices: iii. 40 and iv. 41. The correct answer is not ii. 39, as a buy stop order triggers at the stop price or higher.
A buy stop order is a type of order used in trading. It is designed to be executed at the 'stop' price or higher once a stock price hits or passes the buy stop price. It is primarily used to limit a loss or protect a profit on a stock that an investor has sold short. If you placed a buy stop order at 39, the order would only activate if the stock price hits 39 or goes higher. Therefore, possible fill prices could be 40 or 41, but not the lower prices like 38. The order remains inactive until the price threshold is breached.