Which of the following statements is incorrect?
A)Market-makers take positions to capitalize on the discrepancy between the prevailing stock price and their own valuation of a stock.
B)Specialists and market-makers may take the opposite position of uninformed investors and therefore stand to benefit if their expectations are correct.
C)For each stock that is traded in the Nasdaq market, there are 50 market-makers on average.
D)The spread quoted for a given stock may vary among market-makers.

Question

Quizplus · Accepted Answer

The statement that "For each stock that is traded in the Nasdaq market, there are 50 market-makers on average" is incorrect. While the number of market-makers varies depending on the stock, it is generally not as high as 50.

Which of the Following Statements Is Incorrect