Which one of the following is a primary market transaction?
A) A dealer selling shares of stock to an individual investor.
B) A dealer buying newly issued shares of stock from a corporation.
C) An individual investor selling shares of stock to another individual.
D) A bank selling shares of a medical firm to an individual.
E) A sole proprietor buying shares of stock from an individual investor.

Question

Quizplus · Accepted Answer

A primary market transaction involves the issuance of new securities directly from an issuer to investors. Choice B, where a dealer buys newly issued shares of stock from a corporation, is an example of a primary market transaction because it involves the initial sale of new securities.

Which One of the Following Is a Primary Market Transaction