Multiple Choice (1 point each)

1. Durable goods orders showed an increase of 5% as opposed to a forecast of 3% and historical of 6%, meanwhile inventory increased by 3% as opposed to historical of 4% and forecast of 1%. Based on this data, you are more likely to invest in: a. Bonds as the increase in inventory indicates a slowdown in the economy more than expected b. Bonds as the above data indicates the economy is doing worse than the previous year c. Stocks as the above data indicates the economy is doing better than expected d. Stocks as the inventory data is indicating that the economy is doing better than the previous year e. Cannot tell from the provided information

2. The capital markets consist of the primary market and secondary market. Which of the following statements is true regarding the differences between the two markets? a. New issues are distributed to investors in the primary market while existing securities are traded in the secondary market. b. Existing securities are traded in the primary market while new issues are distributed to investors in the secondary market. c. New issues are traded in the primary market while existing securities are distributed in the secondary market. d. Existing securities are distributed to investors in the primary market while new issues are traded in the secondary market.