Which ONE of the following statements is true about secondary markets?
A) The ordinary shares of large companies often rely on word-of-count to find interested buyers.
B) Brokers bring buyers and sellers together to earn a fee.
C) The presence of active brokers increases market inefficiency.
D) A specialist is a specific location on the floor of a securities exchange at which auctions for a particular security take place.

Question

Quizplus · Accepted Answer

Brokers play a crucial role in secondary markets by bringing buyers and sellers together and facilitating transactions. In return, they earn a fee or commission. A is incorrect as most large companies list their shares on stock exchanges where buyers can find and purchase them through brokers. C is incorrect as active brokers increase market efficiency by improving price discovery and liquidity. D is incorrect as a specialist is a person, not a location, who is responsible for maintaining an orderly market for a particular security. They can operate from a designated post on the exchange floor or remotely through electronic trading platforms.

Which ONE of the Following Statements Is True About Secondary