The main benefit to the economy from an active stock market is the ready availability of risk capital for investment in equities through the primary market. For that risk capital to be readily available, investors need to have an easy exit route. Aliquid secondary market provides an easy exit route through the active involvement of buyers and sellers. It does not matter whether these buyers and sellers have short or long-term investment horizons. Liquidity in the market is enhanced by leveraged players who either borrow to play the market or achieve a similar result through futures contracts whose economic value includes financing costs. Short-sellers confer a similar benefit by borrowing stock or achieving the same result through futures contracts.
Active secondary market provides liquidity to the transactions in primary market.

Options

A. If the inference is definitely true' i.e. it properly follows from the statement of facts given.
B. if the inference is probably true though not definitely true' in the light of the facts given.
C. If the data are inadequate, le from the facts given you cannot say whether the inference is likely to be true or false
D. If the inference is probably false", though not definitely false' in the light of the facts given.

Answer

A

Explanation

According to the passage, the given inference directly follows the third sentence of the passage.
Therefore, the given inference is definitely true.