Which of the following statements is NOT true about broker 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 what they charge as a commission 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 do not have an inventory of securities and therefore cannot guarantee an order. They only bring buyers and sellers together and facilitate the transaction for a fee.

Which of the Following Statements Is NOT True About Broker