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Just Did This to Join

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Submitted By adamuc06
Words 1815
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Brigham Concise 4th Edition

Chapter 4:
The Financial Environment: Markets, Institutions, and Interest Rates

1. The New York Stock Exchange (NYSE) is:
a. a secondary market.
b. a physical asset market.
c. a primary market
d. Statements a and b are correct.
e. Statements b and c are correct.
a. Correct.

2. An example of a primary market transaction is:
a. buying 100 shares of Wal-Mart stock from your uncle.
b. buying 100 shares of IBM stock through the New York Stock Exchange via an online brokerage firm
c. buying 100 shares of a new issue of Home Depot common stock
c. Correct.

3. Money markets are:
a. markets for long-term debt and common stocks.
b. markets for “real” or “tangible” assets.
c. markets for short-term, highly liquid debt securities.
c. Correct.

4. Investment banking firms:
a. facilitate the issue of new securities.
b. are secondary market participants.
c. are primary market participants.
d. a and b are true
e. a and c are true
e. Correct.

5. Financial intermediaries:
a. act as middlemen to facilitate the issuance of new securities by firms and governments.
b. literally create new forms of capital (securities).
c. facilitate the transfer of funds from savers to demanders of capital
d. a and b
e. b and c
e. Correct.

6. Which of the following are financial intermediaries?
a. commercial banks
b. mutual funds
c. life insurance companies
d. all of the above
e. none of the above
d. Correct.

7. The NASDAQ is primarily
a. a primary market.
b. a physical location auction market.
c. an over-the-counter market.
d. Statements a and b are correct.
e. Statements b and c are correct.
c. Correct.

8. The NYSE does not exist as a physical location; rather it represents a loose collection of dealers who trade stock electronically.
a. True
b. False
Correct.

9. Which of the following is likely to lead

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