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FIN 3400 Exam 1 Questions and Correct
Answers/ Latest Update / Already Graded
Ch1-Q1. Markets in which funds are transferred from those who have
excess funds available to those who have a shortage of available funds
are called
A. commodity markets.
B. funds markets.
C. derivative exchange markets.
D. financial markets.
Ans: D. financial markets
Ch1-Q2. Primary markets are markets where users of funds raise cash
by selling securities to funds' suppliers.
True
False
Ans: True
Ch1-Q3. Secondary markets are markets used by corporations to raise
cash by issuing securities for a short time period.
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True
False
Ans: False
Ch1-Q4. Secondary markets help support primary markets because
secondary markets
I. Offer primary market purchasers liquidity for their holdings
II. Update the price or value of the primary market claims
III. Reduce the cost of trading the primary market claims
Ans: I, II, and III
Ch1-Q5. The NASDAQ is an example of a secondary market, and it is
also an over-the-counter market.
True
False
Ans: True
Ch1-Q6. The New York Stock Exchange (NYSE) is an example of a
primary market
True
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False
Ans: False
Ch1-Q7. There are three types of major financial markets today:
primary, secondary, and derivatives markets. The NYSE and NASDAQ
are both examples of derivatives markets.
True
False
Ans: False
Ch1-Q8. Although corporation do not actually raise any funds in
secondary markets, they are important to the economy and are not
simply a legalized form of gambling.
True
False
Ans: True
Ch1-Q9. IBM creates and sells additional stock to the investment
banker, Morgan Stanley. Morgan Stanley then resells the issue to the
U.S. public. This transaction is an example of a(n)
A. primary market transaction
All rights reserved © 2025/ 2026 |
FIN 3400 Exam 1 Questions and Correct
Answers/ Latest Update / Already Graded
Ch1-Q1. Markets in which funds are transferred from those who have
excess funds available to those who have a shortage of available funds
are called
A. commodity markets.
B. funds markets.
C. derivative exchange markets.
D. financial markets.
Ans: D. financial markets
Ch1-Q2. Primary markets are markets where users of funds raise cash
by selling securities to funds' suppliers.
True
False
Ans: True
Ch1-Q3. Secondary markets are markets used by corporations to raise
cash by issuing securities for a short time period.
All rights reserved © 2025/ 2026 |
, Page |2
True
False
Ans: False
Ch1-Q4. Secondary markets help support primary markets because
secondary markets
I. Offer primary market purchasers liquidity for their holdings
II. Update the price or value of the primary market claims
III. Reduce the cost of trading the primary market claims
Ans: I, II, and III
Ch1-Q5. The NASDAQ is an example of a secondary market, and it is
also an over-the-counter market.
True
False
Ans: True
Ch1-Q6. The New York Stock Exchange (NYSE) is an example of a
primary market
True
All rights reserved © 2025/ 2026 |
, Page |3
False
Ans: False
Ch1-Q7. There are three types of major financial markets today:
primary, secondary, and derivatives markets. The NYSE and NASDAQ
are both examples of derivatives markets.
True
False
Ans: False
Ch1-Q8. Although corporation do not actually raise any funds in
secondary markets, they are important to the economy and are not
simply a legalized form of gambling.
True
False
Ans: True
Ch1-Q9. IBM creates and sells additional stock to the investment
banker, Morgan Stanley. Morgan Stanley then resells the issue to the
U.S. public. This transaction is an example of a(n)
A. primary market transaction
All rights reserved © 2025/ 2026 |
