FIN 310 Chapter 7 questions

Which one of the following types of securities has no priority in a bankruptcy proceeding? Convertible bond Senior debt Common stock Preferred stock Straight bond

Common stock

Which one of the following generally pays a fixed dividend, receives first priority in dividend payment, and maintains the right to a dividend payment, even if that payment is deferred? Cumulative common Noncumulative common Noncumulative preferred Cumulative preferred Senior common

Cumulative preferred -

A specialist is a(n): employee who executes orders to buy and sell for clients of his or her brokerage firm. individual who trades on the floor of an exchange for his or her personal account. NYSE member who functions as a dealer for a limited number of securities. broker who buys and sells securities from a market maker. trader who only deals with primary offerings.

NYSE member who functions as a dealer for a limited number of securities.

Newly issued securities are sold to investors in which one of the following markets? Proxy Stated value Inside Secondary Primary

Primary

A broker is an agent who: trades on the floor of an exchange for himself or herself. buys and sells from inventory. offers new securities for sale to dealers only. who is ready to buy or sell at any time. brings buyers and sellers together.

brings buyers and sellers together.

An agent who buys and sells securities from inventory is called a: floor trader. dealer. commission broker. broker. floor broker.

dealer.

Inside quotes are defined as the: bid and asked prices presented by NYSE specialists. last bid and asked price offered prior to the market close. lowest asked and highest bid offers. daily opening bid and asked quotes. last traded bid and asked prices.

lowest asked and highest bid offers.