If an individual supplies funds to a business firm by purchasing bonds issued by the firm, the transaction:

Question

Quizplus · Accepted Answer

When an individual purchases bonds issued by a business firm, it is an example of a primary market transaction. In the primary market, securities are issued and sold directly to investors. Options A and B are incorrect as they do not accurately describe the transaction. Option D is also incorrect as the ability to sell securities in the secondary market is determined by market conditions and demand, not by the initial purchase of the security.

If an Individual Supplies Funds to a Business Firm by Purchasing