If you tell your broker the maximum price to pay for a stock,you have placed a
A)market order.
B)limit order.
C)stop-loss order.
D)price order.

Question

Quizplus · Accepted Answer

A limit order is an instruction from a client to a broker that specifies which price they would like to use when buying or selling a stock. When the stock reaches the limit price, the broker will execute the trade at that price or better. Therefore, by providing a maximum price to pay for a stock, the client is placing a limit order. The other options listed are different types of orders. A market order instructs the broker to buy or sell a stock at the current market price. A stop-loss order is an instruction to sell a stock at a specified price if it drops below a certain level. A price order is not a commonly used term in the context of stock trading.

If You Tell Your Broker the Maximum Price to Pay