**When you open a short position, you sell shares and receive money. A market short-sale order generally fills against the highest available bids—the prices buyers offer.** The ask prices are what sellers want. The $2.50 last-sale price only records the previous trade; it does not guarantee your execution price. [Investor.gov: Types of Orders](https://www.investor.gov/introduction-investing/investing-basics/how-stock-markets-work/types-orders)

There are three separate steps:

1. **Borrow shares.** Your broker arranges the stock loan. You owe shares back—1,000 shares in your example—rather than purchasing them from the lender at $2.50. Borrowing fees and collateral requirements are separate from the sale price.
2. **Sell those shares.** Your short-sale order executes against buyers.
3. **Buy shares back later to close the short.** You return those shares to the lender. Your trading profit or loss is the sale proceeds minus the repurchase cost, before fees and other costs. [SEC: Short Selling and Regulation SHO](https://www.sec.gov/investor/pubs/regsho.htm)

For your example, **the ask prices alone cannot tell us what you would receive when opening the short**. We need the *bid* side. Suppose it looks like this:

| Buyers’ bids | Shares available | Your sale proceeds |
|---|---:|---:|
| $2.50 | 500 | $1,250 |
| $2.40 | 250 | $600 |
| $2.00 | 250 | $500 |
| **Total** | **1,000** | **$2,350** |

Assuming those bids remain available, no better prices appear, and no short-sale restriction applies, your market order could fill in those separate pieces, giving an average sale price of **$2.35**. The first price does not apply automatically to all 1,000 shares.

Your original ask ladder—500 at $3, 250 at $3.50, and 250 at $4—would instead matter when **buying**, including buying to close a short. Under the same assumptions, buying all 1,000 would cost **$3,375**, averaging **$3.375 per share**. A limit order lets you specify a minimum selling price or maximum buying price, but may leave some or all shares unfilled. [Investor.gov: Order Execution](https://www.investor.gov/introduction-investing/investing-basics/how-stock-markets-work/types-orders)

As for being unable to short, there is no useful universal frequency. It depends on the stock, requested quantity, your broker’s lending supply, and your account eligibility. A broker may have no shares available to lend, insufficient shares for your order, or restrictions on that stock. Borrow fees can also make an available short expensive. [Schwab: Short-Sale Terms](https://advisorservices.schwab.com/legal/schwab-one-account-agreement)

There is also a U.S. pricing restriction: after a covered stock drops at least 10% from its previous closing price, short sales generally cannot execute at or below the national best bid for the remainder of that day and the following trading day, subject to exceptions. That can prevent immediate execution even when shares are available to borrow. [SEC: Rule 201](https://www.sec.gov/rules-regulations/staff-guidance/trading-markets-frequently-asked-questions-7)