There is an arrangement which allows a firm to use research from another firm at no cost in exchange for executing all of its trades with the firm that provides the research. What this arrangement is called?
Correct answer: B. Quid Pro quo
- A. Mutual arrangement
- B. Quid Pro quo
- C. Bilateral arrangement
- D. common interest
Explanation
Quid pro quo means an exchange of one benefit for another: the firm receives research and directs its trades to the research provider. In finance, this is also commonly described as a soft-dollar arrangement, but that option is absent.
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