Which of the following statements is correct? An IPO is an example of a primary
ID: 2642016 • Letter: W
Question
Which of the following statements is correct?
An IPO is an example of a primary market transaction.
Money markets are subject to wider price fluctuations and are therefore more risky than capital market instruments.
A direct transfer of funds is more efficient than using financial institutions.
The market segmentation theory argues that different investors have different risk preferences, which determine the shape of the yield curve.
a.An IPO is an example of a primary market transaction.
b.Money markets are subject to wider price fluctuations and are therefore more risky than capital market instruments.
c.A direct transfer of funds is more efficient than using financial institutions.
d.The market segmentation theory argues that different investors have different risk preferences, which determine the shape of the yield curve.
Explanation / Answer
a. An IPO is an example of a primary market transaction.
d. The market segmentation theory argues that different investors have different risk preferences, which determine the shape of the yield curve.
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