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ICMA FMFQ Exam - Topic 3 Question 68 Discussion

Actual exam question for ICMA's FMFQ exam

Question #: 68
Topic #: 3

[All FMFQ Questions]

Thinking about dealing on two-way prices, which of the following statements is not true?

APrice-makers quote higher offers than bids

BPrice-makers buy high and sell low

CPrice-takers sell low and buy high

DPrice-takers prefer higher bids and lower offers

Show Suggested Answer

Suggested Answer: B

by Alline at Sep 12, 2024, 07:49 PM

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Vallie

10 months ago

Price-takers usually prefer lower offers, right?

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Carin

10 months ago

Wait, price-makers buy high and sell low? That sounds off.

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Norah

10 months ago

Price-takers wanting higher bids makes sense.

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Devorah

10 months ago

I disagree, I think price-takers can sell high too.

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Coletta

11 months ago

Price-makers definitely quote higher offers than bids.

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Leana

11 months ago

I recall that price-takers usually have less control over prices, so maybe C is the one that's not true, but I need to double-check that.

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Matthew

11 months ago

I feel like I might be mixing up the definitions; I thought price-makers always sell high, but now I'm questioning if that's true for all options.

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Olive

11 months ago

I practiced a similar question where price-takers always accept the market price, so I think D makes sense.

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Maira

11 months ago

I remember that price-makers set the prices, so I think option B sounds off, but I'm not entirely sure.

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Audria

11 months ago

Hmm, I'm a bit unsure about this one. I know price-takers sell low and buy high, but I'm not sure if that's the false statement here. I'll have to think it through carefully before selecting an answer.

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Chandra

11 months ago

I'm pretty confident that price-makers buy high and sell low, so that must be the false statement. The other options all seem to accurately describe the behavior of price-makers and price-takers.

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Richelle

11 months ago

Okay, let me think this through. Price-makers quote higher offers than bids, so that can't be the false statement. Price-takers prefer higher bids and lower offers, so that's also true. I'm leaning towards B or C.

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Nakisha

11 months ago

This question seems straightforward, but I want to make sure I understand the concepts of price-makers and price-takers before selecting an answer.

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Corazon

2 years ago

Haha, if price-makers bought high and sold low, they'd be out of business in no time. That's not how it works!

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Daniel

2 years ago

This question is making my head spin. I'll just go with option D and hope for the best!

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Cassie

2 years ago

User 3: Yeah, that makes sense. Let's go with option D.

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Helaine

2 years ago

I agree, price-takers prefer higher bids and lower offers.

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Erick

2 years ago

I think option D is correct.

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Ilene

2 years ago

Hmm, that makes sense. Price-takers are the ones who have to accept the prices offered to them.

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Corazon

2 years ago

Option C seems a bit off to me. Isn't it the other way around for price-takers? They buy high and sell low, right?

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Deandrea

2 years ago

I'm pretty sure the correct answer is B. Price-makers quote higher offers than bids, not the other way around.

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Izetta

2 years ago

C) Price-takers sell low and buy high

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Leana

2 years ago

B) Price-makers buy high and sell low

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Yong

2 years ago

A) Price-makers quote higher offers than bids

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Hildred

2 years ago

I disagree, I believe the correct answer is C) Price-takers sell low and buy high.

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Veronika

2 years ago

Hmm, I think option B is the one that's not true. Price-makers definitely don't buy high and sell low, that's just silly!

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Dottie

2 years ago

Tomoko: Exactly, that's how they make a profit.

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Sophia

2 years ago

So, the correct statement is that price-makers buy low and sell high.

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Tomoko

2 years ago

Price-makers always aim to buy low and sell high.

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Elroy

2 years ago

I agree, option B doesn't make sense.

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Ilene

2 years ago

I think the answer is B) Price-makers buy high and sell low.

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