Designated Market Makers (DMMs) Are Required To

question 89

Multiple Choice

Designated market makers (DMMs) are required to:

• A) maintain a bid-ask spread no greater than 1 cent per share.
• B) maintain a fair and orderly market.
• C) buy when most others are selling, and vice versa.
• D) sell excess inventory to maintain a strictly neutral position.

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Definitions:

Lorenz Curve

A widely used graph of the distribution of income, with cumulative percentage of households plotted along the horizontal axis and cumulative percentage of income plotted along the vertical axis.

Lorenz Curve

A graphical representation of the distribution of income or wealth within a society, showing the degree of inequality.

Shaded Area

In graphical analysis, the region enclosed by curves or boundaries, often used to represent quantities such as surplus, deficit, or probability.

Transfer Program

Government policies designed to redistribute income in the society through mechanisms such as social security, grants, and subsidies to support the economically disadvantaged.