Question : Assertion: The primary market deals with the trading of existing securities.
Reason: The primary market is involved in the issuance of new securities to the public.
Option 1: Both assertion and reason are true, and the reason is the correct explanation of the assertion.
Option 2: Both assertion and reason are true, but the reason is not the correct explanation of the assertion.
Option 3: Assertion is true, but the reason is false.
Option 4: Assertion is false, but the reason is true.
Correct Answer: Assertion is true, but the reason is false.
Solution : The correct answer is (c) Assertion is true, but the reason is false.
The assertion is false. The primary market is not involved in the trading of existing securities. Instead, it is where new securities are issued for the first time to the public.
The reason is false. The primary market is indeed involved in the issuance of new securities to the public, which is the correct part of the reason. However, it does not deal with the trading of existing securities, making the assertion false.
Question : Assertion: Primary market transactions involve the issuance of new securities to the public.
Reason: Primary market transactions facilitate the trading of existing securities.
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