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A market where securities are bought from or sold to a market maker is known as a

A) Brokered market
B) Primary market
C) Secondary market
D) Dealer market

1 Answer

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Final answer:

A market where securities are bought from or sold to a market maker is known as a Dealer market. Examples include the foreign exchange market and the interbank market.

Step-by-step explanation:

The market where securities are bought from or sold to a market maker is known as a Dealer market. In a dealer market, market makers quote prices at which they are willing to buy or sell securities, acting as intermediaries between buyers and sellers.

One example of a dealer market is the foreign exchange market, where banks and other firms known as dealers trade currencies with customers. The interbank market is a subset of the foreign exchange market where banks trade currencies with each other.

Dealer markets provide liquidity to the securities they trade, allowing investors to quickly buy or sell assets without significant penalties for liquidation.

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