Which of the following is a primary market transaction? a. You sell 200 shares of IBM stock on the NYSE through your broker. b. You buy 200 shares of IBM stock from your brother. The trade is not made through a broker, just give him cash and he gives you the stock c. IBM issues 2,000,000 shares of new stock and sells them to the public through an investment banker. d. One financial institution buys 200,000 shares of IBM stock from another institution. An investment banker arranges the transaction.

Question

Ashlyn Huff

Business

24 September, 15:12

Which of the following is a primary market transaction? a. You sell 200 shares of IBM stock on the NYSE through your broker. b. You buy 200 shares of IBM stock from your brother. The trade is not made through a broker, just give him cash and he gives you the stock c. IBM issues 2,000,000 shares of new stock and sells them to the public through an investment banker. d. One financial institution buys 200,000 shares of IBM stock from another institution. An investment banker arranges the transaction.

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Answers (1)

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Gordon Flowers · Answer 1

c. IBM issues 2,000,000 shares of new stock and sells them to the public through an investment banker

Explanation:

The primary market is the market when for the first time the new securities such as shares, stocks, etc. are being provided to the general public or we can refer initial public offer. The initial public offer is an illustration of the primary market

Whereas the secondary market is the market where the shares are bought or sold through the investors after they are provided to the general public.

For examples-New York Stock Exchange (NYSE), etc.