Answer:
Forex OTC Market Explained
User
What does it mean to describe the foreign-exchange market as an "over-the-counter market"?
A. The market consists of customers buying and selling in the foreign-exchange market directly.
B. The market consists of market makers linked together by computers.
C. The market is a physical place where currencies are traded.
D. The market consists of customers linked together by computers.
ChatGPT
The correct answer is D. The foreign-exchange market is described as an "over-the-counter market" because it consists of customers linked together by computers. In an over-the-counter (OTC) market, participants trade directly with each other rather than through a centralized exchange. In the foreign-exchange market, participants such as banks, financial institutions, corporations, and individual traders connect electronically to buy and sell currencies. There is no physical location where the trading takes place. Instead, participants access the market through computer networks and trading platforms.