Explain the primary differences between the primary market and the secondary market. Is an IPO most related to the primary market or the secondary market? Explain.
What will be an ideal response?
The primary market is a market in which an investor purchases financial securities (via an investment bank) directly from the issuer of the securities. The secondary market is a market for existing financial securities that are traded between investors. Although a share of corporate stock is only sold one time in the primary market, the stock can be sold again and again in the secondary market. An initial public offering (IPO) occurs when a corporation sells common stock to the general public the first time and, therefore, is most associated with the primary market.
You might also like to view...
From 1970 to 2000, the U.S. dollar ____ against the Japanese yen and ____ against the German mark.
A. depreciated against both the Japanese yen and the German mark. B. appreciated against both the Japanese yen and the German mark. C. depreciated against the Japanese yen and appreciated against the German mark. D. appreciated against the Japanese yen and depreciated against the German mark.
The Sarbanes-Oxley Act of 2002 requires all of the following to certify a public company's system of internal control, except for the
A) chief financial officer. B) the independent auditors. C) the board of directors. D) chief executive officer.
In John Marston's R-A-C-E model, the key component is action
Indicate whether the statement is true or false
Capital budgeting methods which incorporate the time value of money include the ________.
A) net present value method B) accounting rate of return C) average rate of return D) payback method