Ch 2

Which of the following acts regulates the secondary market ? Select one: a. The Glass-Steagall Act b. The Gramm-Leach-Bliley Act c. The Securities Act of 1933 d. The Securities Exchange Act of 1934

The ________ is created by a financial relationship between suppliers and demanders of short-term funds. Select one: a. forex market b. capital market c. money market d. stock market

The Glass-Steagall Act ________. Select one: a. was intended to regulate the activities in the primary market b. separated the activities of commercial and investment banks c. was intended to regulate the activities in the secondary market d. created the Securities Exchange Commission

As a key participant in financial transactions, individuals are ________. Select one: a. net demanders of funds because they save more money than they borrow b. net purchasers of funds because they save more money than they borrow c. net users of funds because they save less money than they borrow d. net suppliers of funds because they save more money than they borrow

Most businesses raise money by selling their securities in a ________. Select one: a. forex market b. commodities market c. public offering d. futures market

Which of the following is true of international equity markets? Select one: a. In the international equity market, corporations can sell blocks of shares to investors in a number of different countries simultaneously. b. In the international equity market, corporations can only sell blocks of shares to institutional investors from European Union. c. In the international equity market, corporations can easily manipulate the price of the shares since it is not regulated by any regulatory bodies. d. In the international equity market, corporations cannot raise capital through IPOs, instead they can raise capital by trading in the secondary market.

Which of the following is true of a dealer market? Select one: a. It has centralized trading floors. b. It is a part of the broker market. c. Buyers and sellers are never brought together directly. d. Brokers execute the buy or sell orders in a dealer market.

Which of the following is true of a primary market? Select one: a. It is an organized market in which all financial derivatives are traded. b. It is the only market in which the issuer is directly involved in the transaction. c. It is a market where smaller, unlisted securities are traded. d. It is regulated by The Sarbanes-Oxley Act.

The money market is a market ________. Select one: a. which brings together suppliers and demanders of short-term funds b. where smaller, unlisted securities are traded c. where all derivatives are traded d. that enables suppliers and demanders of long-term funds to make transactions

Firms that require funds from external sources can obtain them ________. Select one: a. through forex market b. by issuing T-bills c. through financial institutions d. from central bank directly