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.

Question

Quizplus · Accepted Answer

In a primary market transaction, securities are created and sold for the first time. Option 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 issuance of stock by the corporation.

Which One of the Following Is a Primary Market Transaction