A Primary Market Would Be Utilized When

question 75

Multiple Choice

A primary market would be utilized when:

• A) investors buy or sell existing securities.
• B) shares of common stock are exchanged.
• C) securities are initially issued.
• D) a commission must be paid on the transaction.

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Definitions:

Consumer Surplus

The difference between the maximum price consumers are willing to pay and the price they actually pay. It is the net gain derived by the buyers of the good.

Cell-Phone Service

A service provided by telecommunications companies that enables mobile phone users to make and receive calls, texts, and use data.

Utility-Maximizing

A behavioral principle where consumers allocate their income to purchase a mix of goods and services that provides the highest overall utility.

Last Dollar

The final unit of currency spent or invested in a particular context, emphasizing its potential impact or value.