ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Notes: In primary markets, property of shares which made it easy to sell newly issued security is considered as increased liquidity. Liquidity is the amount of money that is readily available for investment and spending.

Detailed explanation-2: -The primary market may also be called the New Issue Market (NIM). In the primary market, securities are directly issued by companies to investors. Securities are issued either by an Initial Public Offer (IPO) or a Further Public Offer (FPO).

Detailed explanation-3: -In the primary market, new securities are offered for the first time for sale to increase the capital. And because of that, it is also known as New Issue Market. In this market, the company sells the stocks directly to the investor.

Detailed explanation-4: -A preferential issue is one of the quickest methods available to companies for raising capital. Both listed and unlisted companies can issue shares or convertible securities to a select group of investors. However, the preferential issue is neither a public issue nor a rights issue.

Detailed explanation-5: -Key Takeaways The primary market is where securities are created, while the secondary market is where those securities are traded by investors. In the primary market, companies sell new stocks and bonds to the public for the first time, such as with an initial public offering (IPO).