2-1 How does a cost-efficient capital market help reduce the prices of goods and services?

2-2 Describe the different ways in which capital can be transferred from suppliers of capital to those who are demanding capital.

2-3 Is an initial public offering an example of a primary or a secondary market transaction?

2-4 Indicate whether the following instruments are examples of money market or capital market securities.

a. U.S. Treasury bills

b. Long-term corporate bonds

c. Common stocks

d. Preferred stocks

e. Dealer commercial paper

2-5 What would happen to the U.S. standard of living if people lost faith in the safety of the finabcial institutions? Explain.