Which of the following is true?
A)Insider information is public information.
B)Brokerage firms act as brokers, dealers, and investment bankers.
C)Dealers are pure intermediaries who act as agents.
D)Brokers make their living by selling securities at a higher price than what they paid for them.

Question

Quizplus · Accepted Answer

Brokerage firms can act in various capacities depending on the transaction. As brokers, they facilitate trades between buyers and sellers. As dealers, they may buy and sell securities for their own account. As investment bankers, they help companies raise capital through issuing and underwriting securities.

(Note: A is incorrect because insider information is non-public information that could influence stock prices. C is incorrect because dealers can also take on the role of principal by buying and selling securities for their own account. D is incorrect because brokers make their living through commissions or fees, not from buying and selling securities for profit.)

Which of the Following Is True