Classify each of the following transactions, sequentially, as occurring in either the primary market or the secondary market: 1. Rosetta Stone goes public with an offering of 6,250,000 in April of 2009
2) Health Care REIT, Inc., which is already publicly traded, issues 13,800,000 additional shares of stock as a public offering in August 0f 2012
3) Laurie's Thursday night investment club buys 500 shares of Kohl's from their stockbroker following the recommendation of one of their members.
4) A student sells 50 shares of McDonald's stock online to fund her summer travel plans.
A) 1. Primary market, 2. Primary market, 3. Primary market, 4. Primary market
B) 1. Primary market, 2. Primary market, 3. Secondary market, 4. Secondary market
C) 1. Secondary market, 2. Secondary market, 3. Primary market, 4. Primary market.
D) 1. Secondary market, 2. Secondary market, 3. Secondary market, 4. Secondary market.

Question

Quizplus · Accepted Answer

1. Primary market because Rosetta Stone is issuing new shares to the public for the first time.2. Primary market because Health Care REIT, Inc. is issuing new additional shares to the public.3. Secondary market because the transaction involves buying existing shares from another investor, not directly from the company.4. Secondary market because the student is selling her existing shares to another investor, not back to the company.

Classify Each of the Following Transactions, Sequentially, as Occurring in Either