Which one of the following transactions occurs in the primary market?
A) Purchase of 500 shares of GE stock from a current shareholder
B) Gift of 100 outstanding shares to a charitable organization
C) Gift of 200 shares of stock by a mother to her daughter
D) A purchase of newly issued stock from the issuer
E) IBM's purchase of GE stock from a dealer

Question

Quizplus · Accepted Answer

The primary market is where new securities are issued and sold for the first time, and investors can purchase them directly from the issuer. Therefore, only choice D describes a transaction that occurs in the primary market.

Which One of the Following Transactions Occurs in the Primary