A pure auction market is one in which
A) dealers provide liquidity by buying and selling shares of stock for themselves.
B) dealers compete against each other to provide the highest bid and lowest asking prices.
C) buyers submit bid prices to sellers.
D) sellers submit ask prices to buyers.
E) buyers and sellers submit bid and ask prices to a central location to be matched.

Question

Quizplus · Accepted Answer

In a pure auction market, buyers and sellers submit their own bid and ask prices to a central location, such as an exchange or trading platform. The market then matches these orders based on price and quantity, allowing for transparent and efficient price discovery. This is in contrast to markets where dealers provide liquidity or compete against each other to set prices.

A Pure Auction Market Is One in Which