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1 FINANCE MCQS

The placement of a financial issue where the investment bank and municipality jointly find large buyers is called ____________?

  • Reserve placement
  • Federal placement
  • Private placement
  • Government placement
Correct Answer: C. Private placement

Detailed Explanation

Private placement is a method of selling securities directly to a small group of large investors instead of offering them in a public market. In this approach, an investment bank and a municipality work together to identify and negotiate with institutional investors, such as insurance companies or pension funds, ensuring quick placement without a public offering process.

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