Securities Markets Quiz

What is the primary function of a stock exchange?

• To issue new securities

• To provide a platform for buying and selling securities

• To regulate interest rates

• To insure investments

True or False: A broker buys and sells securities on behalf of individual investors.

Which of the following is a type of security that represents ownership in a company?

• Bond

• Stock

• Option

• Futures

What is a market maker?

• An entity that provides insurance for securities

• An individual who issues new securities

• An individual or firm that buys and sells securities to provide liquidity

• A government agency that regulates the market

True or False: Bonds represent a share in the ownership of a company.

What does a broker primarily do?

• Creates financial products

• Manages investment portfolios

• Facilitates the buying and selling of securities for clients

• Sets interest rates

Which of the following is a derivative?

• Common Stock

• Corporate Bond

• Option Contract

• Treasury Bill

What is an IPO?

• Initial Public Offering

• Investment Public Option

• International Purchase Order

• Initial Public Option

True or False: Securities markets are primarily used to help companies raise capital.

What does the term "liquidity" refer to in securities markets?

• The ability to generate profit

• The ease with which securities can be bought or sold without affecting their price

• The rate of return on investments

• The level of government regulation