Exam3-Final-19

Question 1

Security Markets

Answer 1

financial market place for stocks, bonds, and other investments.

• Assist businesses in finding long term funding to finance capital needs.
• provide private investors a place to buy and sell securities

Question 2

Type of Security Markets

Answer 2

Primary-handle the sale of new securities.

Secondary-handles the trading of these securities between investors.

Question 3

IPO

Answer 3

Initial Public Offering

-first public offering of a corporations stock.

Question 4

Investment Banker

Answer 4

specialist’s who assist in the issue and sale of new securities.

Question 5

Institutional investors

Answer 5

large organizations that invest their own funds or the funds of others.

Question 6

Stock Exchange

Answer 6

organization whose members can buy and sell securities for companies and individual investors.

Question 7

Over the Counter Market

Answer 7

Exchange that provides a means to trade stocks not listed on the national exchanges.

Question 8

Securities and Exchange Commission

Answer 8

Federal agency that has responsibility for regulating the various stock exchanges.

Question 9

Buying stock on margin

Answer 9

borrowing some of the stocks purchase cost from the brokerage firm

Question 10

program trading

Answer 10

instructions to computers to automatically sell if the price of a stock dips to a certain point to avoid potenitional losses

Question 11

mutual fund

Answer 11

organization that buys stocks and bonds and then sells shares in those securites to the public.

Question 12

Diversification

Answer 12

buying several different investment alternatives to spread the risk of investing