The Main Functions of Markets Include

question 105

Multiple Choice

The main functions of markets include

• A)establishing a physical location for business transactions.
• B)promoting the social interest, but not the self- interest.
• C)enabling buyers and sellers to get information about each other.
• D)selling goods, but not factors of production.
• E)promoting the self- interest, but not the social interest.

---

Definitions:

Option Premium

An option premium is the price that a buyer pays to the seller for an options contract, which gives the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified strike price.

Conversion Price

The predetermined price at which convertible securities can be exchanged for common stock.

Convertible Bond

A type of bond that can be converted into a predetermined number of the issuing company's shares at certain times during its life, usually at the discretion of the bondholder.

Par Value

The face value of a bond or a stock, as stated by the issuing company.