Shoutbox » Explanation: The public offering price is

ansaction. The ask price is the price at which market makers in the over-the-counter market are willing to sell the stock http://www.airmaxchinepascher.com/ , and over-the-counter transactions, like NYSE transactions, are executed by brokers.

Question: 16

Noah Mete is interested in selling his shares of the Lambchops Corporation Air Max Rouge Pas Cher , which trades over-the-counter. The market maker with the best bid price--$3.15--is Veggie Investments. The market maker with the best ask price--$3.27-is Carnivor Investments. Noah conducts trades in NYSE-listed stocks through his broker, Omnivor and Associates.
Given this scenario, which of the following statements is true?


A. Noah can sell his shares of Lambchops Corporation at the bid price of $3.15 by contacting Veggie Investments directly.
B. Noah can sell his shares of Lambchops Corporation at the ask price of $3.27 by contacting Carnivor Investments directly.
C. Noah can sell his shares of Lambchops Corporation at the bid price of $3.15 by contacting Omnivor and Associates.
D. Noah can sell his shares of Lambchops Corporation at the ask price of $3.27 by contacting Omnivor and Associates.


Answer: C


Explanation:
Noah can sell his shares of Lambchops Corporation for $3.15 from the market maker with the best bid price Air Max Rose Pas Cher , Veggie, by contacting his broker, Omnivor and Associates Air Max Blanc Pas Cher , which will execute the transaction. The bid price is the price at which market makers in the over-the-counter market are willing to buy the stock, and over-the-counter transactions, like NYSE transactions Air Max Noir Pas Cher , are executed by brokers.


Question: 17

Which of the following represents a secondary market transaction?


A. An investor buys Treasury bills in the regular Monday auction.
B. An investor buys 300 shares of Electromed (ELMD) at its IPO offer price of $4.00 a share.
C. An investor sells her shares of Sunvalley Solar, Inc. (SSOL), which sells on the OTC Bulletin Board for $0.059 a share.
D. A home buyer obtains a mortgage through his savings and loan.


Answer: C


Explanation:
Explanation: When an investor sells her shares of Sunvalley Solar that is listed on the OTC Bulletin Board Air Max Pas Cher Livraison Gratuite , it is a secondary market transaction since shares are being bought and sold between investors. All the other selections involve a new issue of securities, which makes them primary market transactions.


Question: 18

Which of the following statements about primary market transactions is true?


A. A primary market transaction is defined as a transaction that is executed on either the NYSE or NASDAQ. Transactions that take place on ECNs are secondary market transactions.
B. In a primary market transaction, the issuer of the security receives the proceeds from the sale of the security.
C. A primary market transaction refers to the trading of stocks; a secondary market transaction is defined as a transaction that involves bonds.
D. Both A and B are true statements.


Answer: B


Explanation:
In a primary market transaction Air Max Pas Cher Chine , the issuer of the security receives the proceeds from the sale of the security. A secondary market transaction involves the purchase and sale of a security between investors, and the seller of the security receives the proceeds from the sale. Both stocks and bonds are initially introduced to the market as primary market securities and are then traded in the secondary market.


Question: 19

A new issue of common stock can be classified in which of the following categories?
I. primary market
II. money market
III. secondary market
IV. capital market


A. I only
B. III only
C. I and IV only
D. II and III only


Answer: C


Explanation:
Only Selections I and IV are correct. A new issue of common stock will be sold in the primary market. It is also a capital market security since it has no maturity, and capital market securities are securities with greater than one year to maturity.


Question: 20

Which of the following securities would be exempt from SEC registration requirements?
I. a 15-year bond issued by the state of Colorado
II. an issue of preferred stock that has an aggregate par value of $5 million
III. an issue of commercial paper that has a 5-month maturity


A. I only
B. III only
C. I and III only
D. I and II only


Answer: C


Explanation:
Only Selections I and III are exempt from SEC registration requirements. The bond issued by Colorado is exempt because bonds issued by a government body are exempt from registration. The issue of commercial paper is exempt because securities with less than 270 days to maturity are exempt from registration.


Question: 21

The investment banker bears the risk if the securities do not sell in a(n):


A. firm commitment underwriting agreement.
B. best efforts agreement.
C. all-or-nothing commitment.
D. None of the above selections are correct. The investment banking firm is never exposed to risk if the securities don鈥檛 sell.


Answer: A


Explanation:
The investment banker bears the risk if the securities do not sell in a firm commitment underwriting agreement. In this type of agreement Nike Air Max Pas Cher , the investment banker purchases the security from the issuing firm and is fully exposed to any risk associated with the issue.


Question: 22

Which of the following steps in the underwriting process will occur last?


A. The underwriting syndicate is formed.
B. The selling group is organized.
C. The public offering price is set.
D. A red herring prospectus is circulated to the public.


Answer: C


Explanation:
The public offering price is

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