An Important Financial Institution That Assists in the Initial Sale

question 48

Multiple Choice

An important financial institution that assists in the initial sale of securities in the primary market is the

• A)investment bank.
• B)commercial bank.
• C)stock exchange.
• D)brokerage house.

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Definitions:

Equilibrium

The point in a market where the quantity demanded by consumers equals the quantity supplied by producers, leading to a stable price.

Surpluses

The quantity of goods that remains when a producer has more goods than it is able to sell at the current price.

Shortages

Occurrences when the demand for a product or service exceeds its supply in a market, often leading to higher prices and unmet consumer needs.

Equilibrium Price

The market price at which the quantity of a good supplied equals the quantity demanded, leading to a stable market situation.