Which of the following statements about financial markets and securities is true?
A) Many common stocks are traded over-the-counter, although the largest corporations usually have their shares traded at organized stock exchanges such as the New York Stock Exchange.
B) As a corporation gets a share of the broker's commission, a corporation acquires new funds whenever its securities are sold.
C) Capital market securities are usually more widely traded than shorter-term securities and so tend to be more liquid.
D) Because of their short-terms to maturity, the prices of money market instruments tend to fluctuate wildly.

Question

Quizplus · Accepted Answer

Many common stocks are traded over-the-counter, although the largest corporations usually have their shares traded at organized stock exchanges such as the New York Stock Exchange.

Option B is incorrect because a corporation does not receive a share of the broker's commission when its securities are sold. Option C is incorrect as capital market securities are usually less liquid compared to shorter-term securities. Option D is incorrect as money market instruments are known for their stability and low risk, so their prices tend to remain stable.

Which of the Following Statements About Financial Markets and Securities