Question

Which of the following is incorrect concerning the trading of common stock in the U.S. financial markets?

Select one:

a. Common stock usually has no special preference in bankruptcy.

b. On or after the ex-dividend date, the buyer will not receive the next dividend.

c. The ask price is the price at which a dealer will sell the stock in question.

d. Most trading of common stocks is now done electronically.

e. Each time a share of a firm’s common stock trades a stock exchange, the firm receives additional new funding.

Answer 1

  

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Each time a share of a firm’s common stock trades a stock exchange, the firm receives additional new funding. - This statement is incorrect as the firm receives the funds only in the Primary market not in the secondary market.

Option e is correct.

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