Financial Markets Are Used for Trading

question 6

Multiple Choice

Financial markets are used for trading:

• A) both real assets and financial assets.
• B) the goods and services produced by a firm.
• C) securities, such as shares of IBM.
• D) the raw materials used in manufacturing.

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Definitions:

Closely Held

Closely held companies are usually small, owned by a small number of people, typically managers and their common shares are not actively traded.

Primary Market Transactions

Deals that occur in the primary market, where new securities are issued and sold by companies or governments directly to investors, raising capital.

Stock Exchanges

Marketplaces where securities, such as stocks and bonds, are bought and sold by investors.

Issuing Companies

Companies or entities that offer securities, such as stocks or bonds, to the public for the purpose of raising capital.