Economics · Financial Markets
What is the primary purpose of implementing trading curbs, such as circuit breakers, on stock exchanges?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1To prevent investors from making trades during specific intraday rest periods.
- 2To temporarily halt trading and curb panic selling when market prices change or drop rapidly.✓
- 3To automatically adjust the benchmark indices when a single stock underperforms.
- 4To restrict foreign institutional investors from manipulating mid-cap stock prices.
Correct answer
To temporarily halt trading and curb panic selling when market prices change or drop rapidly.
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