Asked by Kayli Swigart on May 26, 2024
Verified
In ________ markets, participants post bid and ask prices at which they are willing to trade, but orders are not automatically executed by computer. ________ execute trades for people other than themselves, and in ________ markets a computer matches orders with an existing limit order book and executes the trades automatically.
A) electronic; Dealers; brokers
B) dealer; Brokers; electronic
C) direct search; Brokers; electronic
D) brokered; Dealers; direct search
Electronic Markets
Trading platforms that operate over computer networks where transactions are completed electronically rather than through physical exchanges.
Direct Search
A method of job hunting or problem solving that involves approaching potential employers or solutions directly rather than through intermediaries.
Dealers
Financial intermediaries that buy and sell securities from their own inventory, acting as principal in the transaction.
- Distinguish between different types of markets (electronic, dealer, brokered, direct search) and their operational mechanisms.
Verified Answer
DK
Damian KohutMay 29, 2024
Final Answer :
B
Explanation :
In dealer markets, dealers post bid and ask prices and execute trades, often for their own accounts. Brokers execute trades for others, acting as intermediaries. In electronic markets, computers automatically match and execute orders based on an existing limit order book.
Learning Objectives
- Distinguish between different types of markets (electronic, dealer, brokered, direct search) and their operational mechanisms.