A Company's Stock Does Not Have to Be Listed on One

question 121

Multiple Choice

A company's stock does not have to be listed on one of the major stock exchanges in order to trade. It can be traded on

• A) over-the-counter market.
• B) NYSE Euronext.
• C) NASDAQ.
• D) AMEX.

---

Definitions:

Coase Theorem

A principle that asserts if property rights are clearly defined and transaction costs are low, private negotiations will lead to the efficient resolution of disputes over the allocation of resources.

Transaction Costs

The costs that parties incur during the process of agreeing to and following through on a bargain.

Mutually Beneficial Agreement

An arrangement between parties where both or all receive benefits or advantages.

Coase Theorem

A legal and economic theory that states that if trade in an externality is possible and there are no transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property.