Entering an order to sell stock at $17 when the bid is $18–$19 is an example of a

A. market order.
B. short sale.
C. margin payment.
D. limit order.

D seems like the best answer

To determine the correct answer, let's analyze each option and see which one applies to the given scenario.

A. Market order: A market order is an instruction given to buy or sell a stock at the current market price. In this scenario, the market order would sell the stock at the current bid price, which is $18-$19. Since the instruction is to sell at a specific price of $17, it does not match the definition of a market order. Therefore, A is not the correct answer.

B. Short sale: A short sale is when an investor sells borrowed stock in the hopes of buying it back at a lower price to make a profit. However, the given scenario does not involve borrowing stock, so B is not the correct answer.

C. Margin payment: A margin payment refers to the funds provided by an investor to cover the partial cost of a purchase. It is not relevant in the given scenario, as no margin or partial payment has been mentioned. Therefore, C is not the correct answer.

D. Limit order: A limit order is an instruction given to buy or sell a stock at a specific price or better. In this scenario, the instruction is to sell the stock at the limit price of $17. Since the bid price is currently higher, the limit order will not be executed immediately but will wait until the stock price drops to or below $17. Therefore, D is the correct answer.

Hence, the correct answer is D.