Security Markets Provide Liquidity

question 25

Multiple Choice

Security markets provide liquidity:

• A) by allowing corporations to raise funds by selling new issues.
• B) by providing the widest range of information to investors.
• C) by allowing investors access to low-risk investments.
• D) by maintaining confidence in corporate governance of listed firms.

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Definitions:

Multinationals

Corporations that own or control production of goods or services in one or more countries other than their home country, often having a significant impact on global trade and economy.

Division of Labour

The distribution of various segments of a production task among different individuals to enhance productivity.

Time Crunch

A situation characterized by a pressing or limited amount of time to complete tasks or activities.

Interlocking Directorates

The practice of members of a corporate board of directors serving on the boards of multiple corporations simultaneously, often leading to conflicts of interest or consolidation of power.