An Attempt by a Market Maker to Earn a Profit

question 52

Multiple Choice

An attempt by a market maker to earn a profit on the price movements of securities by taking inventory positions for its own account is called

• A)risk arbitrage.
• B)an agency transaction.
• C)best efforts underwriting.
• D)pure arbitrage.
• E)a principal transaction.

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Definitions:

Problem Solving

The process of finding solutions to difficult or complex issues.

Habituation

A simple form of learning in which an organism stops responding to a stimulus after repeated exposure, not involving any reward or punishment.

Gene Pool

The complete set of unique alleles in a population or species, representing its genetic diversity.

Organisms

Living entities that can carry out life processes independently, including plants, animals, fungi, bacteria, and archaea.