Which One of the Following Transactions Occurs in the Primary

question 47

Multiple Choice

Which one of the following transactions occurs in the primary market?

• A)purchase of 500 shares of GE stock from a current shareholder
• B)gift of 100 shares of stock to a charitable organization
• C)gift of 200 shares of stock by a mother to her daughter
• D)a purchase of newly issued stock from AT&T
• E)IBM's purchase of GE stock

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Definitions:

Endorsement

The signing of one’s name on the back of a negotiable instrument for the purpose of negotiating it to another.

Premiums

Payments made regularly to an insurance company in exchange for coverage, representing the cost of the insurance policy.

Co-insurance Clause

A provision in insurance policies requiring the policyholder to bear a portion of the loss by maintaining coverage of a specified percentage of the value of the property to receive full reimbursement.

Fireproof

The quality of being resistant to or capable of withstanding damage by fire.