Stocks

What is a stock in the context of the stock market?

• A government-issued security for investors

• A type of currency used for trading stocks

• A financial token signifying ownership of a company

• A type of bond representing company debt

What is the difference between common and preferred stocks?

• Common stocks have voting rights, preferred stocks don't

• Preferred stocks have voting rights, common stocks don't

• Both common and preferred stocks have voting rights

• Neither common nor preferred stocks have voting rights

What is an IPO in the stock market?

• A company's initial public offering of shares to the public

• A type of stock with high potential earnings

• An exchange where stocks are bought and sold

• An individual purchasing stocks for the first time

How does supply and demand affect stock prices?

• More buyers lead to higher stock prices

• More sellers lead to higher stock prices

• More buyers lead to lower stock prices

• Supply and demand have no impact on stock prices

What is the purpose of a trading account in the stock market?

• To regulate stock market transactions

• To offer loans for stock purchases

• To allow investors to buy and sell stocks

• To provide financial advice to investors

Why do companies sell stocks in the stock market?

• To increase the price of their stocks

• To raise money for operating capital

• To reduce their ownership in the company

• To manipulate the stock market

What is the significance of the bid-ask spread in stock trading?

• It determines the voting rights of shareholders

• It represents the difference between buying and selling prices

• It reflects the company's market capitalization

• It indicates the company's future earnings potential

How are stock prices determined in the stock market?

• By government regulations

• By company executives' decisions

• By millions of independent transactions

• By stock market analysts' predictions

What is the primary goal of investing in the stock market?

• To achieve financial growth and wealth

• To accumulate physical assets

• To secure government bonds

• To earn a fixed interest rate

What is the role of an exchange in the stock market?

• To regulate stock prices

• To provide financial advice to investors

• To facilitate buying and selling of stocks

• To issue government securities