Question

SOME IMPORTANT TRUE AND FALSE WITH REASON:
Stock Exchange is a primary market.

• A. True
• B. False

Answer 1

The correct option is B False

This statement is 'False' because of the following reasons:
(i) Securities market is classified into Primary and Secondary market.
(ii) When investors directly apply to the issuer company for allotment of shares by paying application money it is called Primary Market.
(iii) When the companies close the issue, a number of persons who want to buy these issued securities from the original holder, so that they can generate a higher return on them by selling them at higher prices.
(iv) This is done in the secondary market i.e., buying and selling of shares. It is called as Stock Exchange.