alleryStart learning →What was the NASDAQ when it was founded in 1971?
AThe first regional securities exchange
BThe first exchange to trade only bonds
CThe first electronic-based stock market
DThe first exchange to list foreign firms
Answer & Solution
Correct answer: C. The first electronic-based stock market
1. The NASDAQ is the largest dealer market, its full name being the National Association of Securities Dealers Automated Quotation system.
2. It was the first electronic-based stock market, a telecommunications network linking dealers throughout the United States.
3. Founded in 1971 with origins in the over-the-counter market, it is today a separate securities exchange no longer part of that market.
4. Its electronic system gives faster transaction speeds than traditional floor markets, which is the main reason for its growth.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 16 "Understanding Financial Management and Securities Markets", section 16.7 Buying and Selling at Securities Exchanges_
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