The Most Important Determinant of How Much an Individual Will

question 119

Multiple Choice

The most important determinant of how much an individual will pay for a share of stock is

• A)The average daily volume for the corporation's shares.
• B)The expectation of future profit.
• C)How well the CEO is compensated.

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Definitions:

Firm Commitment

An underwriting agreement in which an underwriter buys all the securities from the issuer and resells them to investors.

Investment Banker

A professional who works in a financial services company or division that specializes in raising capital for companies, governments, or other entities.

Initial Margin

The upfront payment required when opening a position in the futures market, serving as a guarantee for future contract fulfillment.

Primary Market

The market in which new issues of securities are offered to the public.