SIE practice questioneasyOrder Types: Market and Limit Orders
A customer places a market order to buy 200 shares of XYZ stock. Which of the following best describes what will happen to this order?
- AThe order will be executed immediately at the best available current price.✓ Correct answer
- BThe order will only execute if XYZ falls to the customer's specified price.
- CThe order will not be executed until the market closes.
- DThe order will only execute if XYZ rises to a specified price.
Explanation
Why A — The order will be executed immediately at the best available current price.
A market order is designed to be executed immediately at the best available price in the market, which makes it the most basic and fastest order type. (A) is correct. (B) describes a limit order, which sets a specific price. (C) is incorrect; market orders are executed as soon as possible, not at market close. (D) is also incorrect and does not describe a valid order type.
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