Which of the Following Statements Is True About Secondary Markets

Multiple Choice

Which of the following statements is true about secondary markets?

A) A buyer may incur search costs and find a seller on their own through a direct search.
B) A broker may bring buyers and sellers together, charging a commission.
C) A dealer may sell and buy securities using his inventory, therefore reducing search costs. The dealer's return is the bid/ask spread.
D) An auction market allocates the selling shares to the highest bidder.
E) All of the above statements are true.