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This statement is false. Prices in secondary markets determine

the prices that firms issuing securities receive in primary

markets. In addition, secondary markets make

securities more liquid and thus easier to sell in the primary

markets. Therefore, secondary markets are, if anything,

more important than primary markets.

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11y ago
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11y ago

Because corporations do not actually raise any funds in secondary markets they are less important to the economy than primary market Comment?

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Q: Because corporations do not actually raise any funds in secondary markets they are less important to the economy than primary market?
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Is it true that because corporations do not actually raise any funds in secondary markets they are less important to the economy than primary market?

This statement is false. Prices in secondary markets determine the prices that firms issuing securities receive in primary markets. In addition, secondary markets make securities more liquid and thus easier to sell in the primary markets. Therefore, secondary markets are, if anything, more important than primary markets.


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