Equity market Knowledge Test

Front

What does the term "equity market" refer to?

Back

A market for buying and selling company stocks

Front

What is the primary function of a stock exchange?

Back

To facilitate the buying and selling of securities

Front

What is meant by a “bull market”?

Back

A market where prices are generally rising

Front

What is an IPO (Initial Public Offering)?

Back

A company issuing new shares to the public for the first time

Front

Which of the following is a key indicator of a company's financial health? The stock’s market price, The company's earnings per share (EPS), The volume of shares traded, The interest rate

Back

The company's earnings per share (EPS)

Front

Which of the following is true about dividend payments? Dividends are paid to bondholders, Dividends are typically paid in the form of stock splits, Dividends are paid to shareholders as a portion of the company’s profits, Dividends are mandatory for all companies to pay

Back

Dividends are paid to shareholders as a portion of the company’s profits

Front

What is the role of a market maker in the stock market?

Back

To ensure that stocks have a liquid market by buying and selling on demand

Front

What does "market capitalization" refer to?

Back

The total value of a company's outstanding shares of stock

Front

In equity markets, what does the term "blue-chip stocks" refer to?

Back

Stocks of well-established companies with a history of stable earnings

Front

A stock split generally results in:

Back

A reduction in the price per share without affecting the total value