Which of the following statements is CORRECT?
A) If Disney issues additional shares of common stock through an investment banker, this would be a secondary market transaction.
B) If you purchased 100 shares of Disney stock from your brother-in-
Law, this would be an example of a primary market transaction.
C) The IPO market is a subset of the secondary market.
D) Only institutions, and not individuals, can participate in
Derivatives market transactions.
E) As they are generally defined, money market transactions involve debt securities with maturities of less than one year.

Question

Quizplus · Accepted Answer

Money market transactions involve short-term debt securities with maturities of less than one year. Choice A is incorrect because issuing additional shares would be a primary market transaction. Choice B is incorrect because purchasing shares from an individual (not directly from the company) is a secondary market transaction. Choice C is incorrect because the IPO market is actually part of the primary market. Choice D is incorrect because both institutions and individuals can participate in the derivatives market.

Which of the Following Statements Is CORRECT