Which of the following statements about stock exchanges is correct?

• A. Most stock exchanges today exclusively use floor trading with human brokers.
• B. All stock exchanges require physical presence of traders on the floor.
• C. Most stock exchanges today use electronic trading systems rather than floor trading with human brokers.
• D. Stock exchanges have never used electronic trading systems.

Answer: (C)

Verified step by step guidance

1. Understand the nature of stock exchanges: Stock exchanges are marketplaces where securities like stocks and bonds are bought and sold. Historically, trading was conducted on physical floors with human brokers.
2. Recognize the evolution of trading methods: Over time, technological advancements have led to the adoption of electronic trading systems, which allow trades to be executed via computer networks without the need for physical presence.
3. Evaluate each statement based on current practices: Identify that most modern stock exchanges have shifted from floor trading to electronic trading systems, making statements about exclusive floor trading or mandatory physical presence outdated.
4. Recall that electronic trading systems increase efficiency, reduce costs, and allow for faster transactions, which is why they are now predominant in stock exchanges worldwide.
5. Conclude that the correct statement is the one acknowledging that most stock exchanges today use electronic trading systems rather than relying solely on floor trading with human brokers.