The primary market includes:
A) The purchase and sale of shares of stock between two shareholders.
B) The sale of stock by a shareholder in the open market.
C) The sale of stock by a shareholder in an auction market.
D) The sale of new securities by a corporation for the ﬁrst time to the general public.
E) The sale of stock by a shareholder in the OTC market.

Question

Quizplus · Accepted Answer

The primary market refers to the sale of new securities by a corporation for the first time to the general public. This is commonly done through an initial public offering (IPO), where a company offers its stock to the public for the first time. Choices A, B, C, and E all refer to secondary markets where shares of stock are bought and sold among existing shareholders.

The Primary Market Includes