Which of the following statements are true? A. In the primary market, firms sell
ID: 2633438 • Letter: W
Question
Which of the following statements are true?
A. In the primary market, firms sell shares to investors and in the secondary market investors sell shares to investors
B. In the primary market, investors sell shares to investors and in the secondary market firms sell shares to investors
C. In the primary market, firms sell shares to investors for the firsttime and in the secondary market firms sell shares to investors after the equity issues
D. In the primary market, investors sell shares to investors for the first time and in the secondary market investors sell shares to investors after the initial sale
Explanation / Answer
Primary Market
It's in this market that firms sell (float) new stocks and bonds to the public for the first time.
Secondary Market
The defining characteristic of the secondary market is that investors trade among themselves
therefore:
option a is correct
A. In the primary market, firms sell shares to investors and in the secondary market investors sell shares to investors
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