Which of the Following Is a Characteristic of Secondary Markets

question 5

Multiple Choice

Which of the following is a characteristic of secondary markets for common stock?

• A)Only low-priced shares are traded in these markets
• B)Only high-risk shares are traded in these markets
• C)Secondary markets are where corporations borrow funds
• D)Secondary-market trades do not provide funds for corporations whose stock is traded

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Definitions:

Net Income

The total earnings of a company after subtracting all expenses, taxes, and costs from its total revenue, indicating the company's profit.

Earnings

Earnings typically refer to a company's profit, specifically the amount of money it makes from its operations over a certain period.

Cash Dividend

A payment made by a corporation to its shareholders, usually in the form of cash, based on the number of shares they own.

Report Income

The act of documenting and declaring earned income within a specific period for tax and accounting purposes.