The key distinction between a primary market and a secondary market is that:
A) In the secondary market the issuer receives funds from the buyer.
B) In the secondary market the issuer of the asset does not receive funds from the buyer.
C) In the secondary market the existing issue changes hands.
D) b and c only.
E) None of the above.

Question

Quizplus · Accepted Answer

In the primary market, the issuer of the security sells new securities directly to investors, receiving the funds directly. In contrast, the secondary market involves the trading of securities among investors without the issuer receiving any of the funds from these transactions. This means that in the secondary market, the issuer does not receive funds from the buyer, and the existing issue changes hands among investors.

The Key Distinction Between a Primary Market and a Secondary