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Which step of the machine cycle examines the op-code of the next instruction to be executed?

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The cycle is fetch, decode, execute. The decode step examines the op-code. Typically this means registers are set, ALU is prepared etc.
User Siraris
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Answer:

Decode Is the step of the machine cycle looks at the instruction which is just a sequence of 0s and 1s and decides what needs to be done. It interpretes the instructions,translate the retrieved instruction into a series of computer commands.

User David Wong
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