1. Funds flow from __________ to __________ in the primary market.
A. investors; issuing corporations
B. issuing corporations; investors
C. investors; other investors
D. All of the above
2. The over-the-counter (OTC) market:
A. Is a relatively small market for bond trading.
B. Cannot sell both stocks and bonds.
C. Is a telecommunication network of security dealers.
D. Makes trades from a central geographical location.
3. Which of the following is true concerning official stock exchanges in the U.S.?
A. The listing requirements are generally more restrictive on the NASDAQ than on the New York Stock Exchange (NYSE).
B. Only the most important stocks are traded over-the-counter. (OTC)
C. There majority of bonds are traded over-the-counter.
D. All of the above.
4. Which of the following securities provisions created the Securities Exchange Commission (SEC) to enforce securities laws and regulate U.S. securities markets?
A. The Securities Act of 1933
B. The Securities Exchange Act of 1934
C. Rule 415
D. Rule ATS
5. Capital market securities:
A. Are issued in maturities of more than one year.
B. Can be either debt or equity securities.
C. Typically trade in the secondary market after being issued in the primary market.
D. All of the above.
6. Which of the following is true concerning commercial paper?
a. Most commercial paper is offered in maturities of 270 days or more.
b. All public corporations can issue commercial paper.
c. Commercial paper can be issued either directly or indirectly.
d. All of the above.
7. Which of the following exchanges has brokers on the floor of the exchange assisting clients in buying and selling securities?
I. The New York Stock Exchange (NYSE)
II. Electronic Communication Networks (ECNs)
III. The NASDAQ
a. I only
b. I and II only
c. I and III only
d. I, II, and III
8. Which of the following is considered to be a money market security?
I. Commercial paper
II. Negotiable certificate of deposit
III. Repurchase agreement
a. I and II only
b. I and III only
c. II and III only
d. I, II, and III