Which one of the following statements is NOT true about brokered markets?
A) Brokers bring buyers and sellers together to earn a fee, called a commission.
B) Brokers' extensive contacts provide them with a pool of price information that individual investors could not economically duplicate themselves.
C) Investors have an incentive to hire a broker because they charge a commission that is less than the cost of direct search.
D) Brokers can guarantee an order because they have an inventory of securities.

Question

Quizplus · Accepted Answer

Brokers cannot guarantee an order because they do not have an inventory of securities. Brokers bring buyers and sellers together and earn a commission on the transaction. They use their extensive contacts and market knowledge to provide price information that individual investors could not economically duplicate themselves. Investors have an incentive to hire a broker because the commission they charge is typically less than the cost of direct search.

Which One of the Following Statements Is NOT True About