Firms<br/>raise capital by issuing stock () A: in<br/>the secondary market. B: in<br/>the primary market. C: to<br/>unwary investors. D: only<br/>on days when the market is up.

Where did the explosion take place A: In a super market B: B. In an animal market C: In a stock market.

A financial market consists of foreign exchange market, money market, bond market and equity market. The last two markets usually fall into the category of ______. A: preferred stock market or liquidation market B: stock market or debt market C: securities market or capital market D: securities market or liquidation market

In<br/>a reverse stock split:() A: the<br/>number of shares outstanding increases and owners’ equity<br/>decreases. B: the<br/>firm buys back existing shares of stock on the open market. C: the<br/>firm sells new shares of stock on the open market. D: the<br/>number of shares outstanding decreases but owners’ equity is<br/>unchanged. E: shareholders<br/>make a cash payment to the firm.

Which of the following statements related to preferred stock are correct? I. Preferred stock pays a constant dividend. II. Preferred stock is generally the cheapest source of capital for a firm. III. A decrease in the market value of preferred stock will increase a firm's weighted average cost of capital. IV. An increase in the rating of a preferred stock will increase the cost of preferred. A: II and III only B: I and IV only C: I and III only D: II and IV only E: I, III, and IV only