Stock Jobs Stock Institutions and Financial Markets 2

Question 1

What is the primary function of a stock exchange?

Accepted Answer

To provide a regulated marketplace for buying and selling securities

Answer

To set interest rates for the economy

Answer

To print currency for the government

Answer

To directly lend money to consumers

Question 2

Which market is where companies first sell shares to the public?

Accepted Answer

Primary market

Answer

Secondary market

Answer

Money market

Answer

Forex market

Question 3

What does SEC stand for in U.S. financial regulation?

Accepted Answer

Securities and Exchange Commission

Answer

Stock Exchange Council

Answer

State Economic Committee

Answer

Securities Enforcement Corporation

Question 4

A broker-dealer acts as an agent when it:

Accepted Answer

Executes trades on behalf of a client

Answer

Buys securities for its own inventory

Answer

Issues new shares of stock

Answer

Sets the Federal Reserve discount rate

Question 5

What is the secondary market?

Accepted Answer

Where investors trade previously issued securities among themselves

Answer

Where companies file IPOs

Answer

Where the government auctions new bonds

Answer

Where banks set deposit rates

Question 6

Which institution serves as the central bank of the United States?

Accepted Answer

The Federal Reserve

Answer

The New York Stock Exchange

Answer

The SEC

Answer

The U.S. Treasury Department

Question 7

What is market liquidity?

Accepted Answer

The ease with which an asset can be bought or sold without affecting its price

Answer

The total cash held by a company

Answer

The amount of dividends paid annually

Answer

The interest charged on margin loans